Step 1: Understanding the question.
The question focuses on tectonic settings where the highest mountain chains and thickest crust are found. Mountain chains and thick crust are typically associated with areas of continental collision.
Step 2: Analyzing the options.
(A) Island arc: Island arcs are typically associated with volcanic activity, not with the formation of thick crust and high mountains.
(B) Continental arc: Continental arcs form at subduction zones but do not typically produce the thickest crust.
(C) Continental collision: This is the correct answer. When two continents collide, the crust thickens, forming high mountain chains, like the Himalayas.
(D) Transcurrent: Transcurrent or transform boundaries do not lead to the formation of mountain chains or thick crust.
Step 3: Conclusion.
The correct answer is (C) Continental collision because this is where the thickest crust and highest mountain chains are formed.