Step 1: Solvent decides the path:
Water favours nucleophilic substitution, since hydroxide is strongly hydrated and acts less as a base.
Step 2: Product:
OH takes the place of Cl on the same carbon, giving $\text{CH}_3\text{CH(OH)CH}_2\text{CH}_3$, butan-2-ol (D).
Final Answer:
Butan-2-ol.
\[ \boxed{\text{(D)}} \]