I would say C - two maximum as long as not impeding traffic
This happens to me on some longer rides out in rural Wisconsin and it would be plain rude not to ride single file when someone's overtaking. When there's no one else around it's no problem; you just pay attention so you don't get in anyone's way.
Mr. Kevenides touched on this topic the other day on (Spoiler alert!) UrbanVelo.org.
I rode two abreast'ish yesterday on a few small stretches on Milwaukee and Augusta with a friend but we rode as close as possible to each other and rode pretty slow so passing us should have been easy for other people on bikes.
The correct answer is #3 or C: A maximum of two bicyclists may ride side-by-side, as long as the normal and reasonable movement of traffic is not impeded. This does not mean you're required to single up for vehicles that can pass you without waiting. The law's focus is more on situations when a vehicle has to wait to pass.
You can test your bike safety knowledge with more questions like these at BikeSafetyQuiz.com. Happy Bike Week Chicago!
No more than two riding abreast, so long as traffic is not impeded. Cyclists moving slower than normal traffic flow must move as far to the right as practical, with certain exceptions (left turns, dodging potholes, etc.).
Rules of the Road pamphlet boils the law down to "Ride single file. Do not ride next to each other if possible."
Note: there are more stringent statutes adopted by some towns that explicitly require bikes to ride single file.
If it is a marked lane 14 feet or less (most are 12 feet rural down to 10 feet urban), then a vehicle cannot safely pass a bicycle while remaining in the lane. The vehicle needs to change lanes to pass and the bicyclists can remain side by side.
"10 feet urban"? In which urbs?
Some of the streets in Chicago seem like they have less than 10 feet. Parked cars on each side and two cars driving in different directions seem like they barely have room to squeeze through. The 10 feet is the current ASHTO recommendations for new streets for slow traffic.