**Core Concept:** Respiratory bronchioles are a branch of the terminal bronchioles in the lungs and play a crucial role in gas exchange. They are lined by pseudostratified columnar ciliated epithelium, which aids in mucociliary clearance.

**Why the Correct Answer is Right:** The correct answer, **C. Alveoli**, refers to the small air sacs in the lungs where the majority of gas exchange occurs between the air we breathe and the bloodstream. This is essential for supplying our body with oxygen and removing carbon dioxide.

**Why Each Wrong Option is Incorrect:**

A. **A. Bronchioles:** While bronchioles are smaller airways in the lungs, they are larger than respiratory bronchioles and do not lead to alveoli, making them an incorrect choice.

B. **B. Alveolar ducts:** Alveolar ducts are larger structures than alveoli and are part of the respiratory bronchiolar system, not the final destination.

D. **D. Interstitium:** The interstitium is a connective tissue layer surrounding the respiratory bronchioles and alveoli, not their final destination.

**Clinical Pearl / High-Yield Fact:** Understanding the respiratory bronchiolar system and its connection to alveoli is crucial for understanding gas exchange in the lungs and the body's respiratory system. This knowledge can help medical students interpret clinical cases involving respiratory issues, such as respiratory distress or shortness of breath, which may be caused by damage to the respiratory bronchioles or alveoli, leading to impaired gas exchange.