You're right. Sleeping is a gerund in this sentence.
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Well, let me put on my detective hat and solve this riddle for you! In the sentence "Sleeping is my favorite hobby," the underlined word is "sleeping." Now, what do we know about sleeping? It's something we do, right? So, it's an action! And when a verb is used as a noun, it's called a gerund! Hence, the correct answer is B, gerund! Woohoo, mystery solved! Keep those brain cells working!
You're correct! The underlined portion of the sentence "Sleeping is my favorite hobby" is a gerund. A gerund is a verb form that functions as a noun and ends in -ing. In this sentence, "Sleeping" is acting as the subject of the sentence and functions as a noun. Well done!