Step 1: Find the refractive index of the prism in air.
For minimum deviation,
\[
\mu
=
\frac{\sin\left(\frac{A+\delta_m}{2}\right)}
{\sin\left(\frac{A}{2}\right)}.
\]
Here,
\[
A=80^\circ,\qquad
\delta_m=40^\circ.
\]
Thus,
\[
\mu_p
=
\frac{\sin60^\circ}{\sin40^\circ}.
\]
Step 2: Find the relative refractive index in the liquid.
When the prism is immersed in the liquid,
\[
\mu_{pl}
=
\frac{\sin\left(\frac{80^\circ+10^\circ}{2}\right)}
{\sin40^\circ}
=
\frac{\sin45^\circ}{\sin40^\circ}.
\]
Also,
\[
\mu_{pl}
=
\frac{\mu_p}{\mu_l},
\]
where \(\mu_l\) is the refractive index of the liquid.
Hence,
\[
\mu_l
=
\frac{\mu_p}{\mu_{pl}}
=
\frac{\sin60^\circ}{\sin45^\circ}
=
\frac{\frac{\sqrt3}{2}}{\frac1{\sqrt2}}
=
\sqrt{\frac32}.
\]
Step 3: Write the answer.
Therefore,
\[
\boxed{\sqrt{\frac32}}.
\]
Thus,
\[
\boxed{(B)}
\]
is the correct answer.