You manage two cloud services named Service1 and Service2. The development team
updates the code for each application and notifies you that the services are packaged and
ready for deployment.
Each cloud service has specific requirements for deployment according to the following
table.
In the table below, identify the deployment method for each service. Make only one selection
in each column.
Answer: 
Isn’t it the other way around ?
i agree with Robin
there are two options to upload package in classic portal. from local computer or storage a/c blob.for storage blob ,first you need to upload package then deploy
below statement is from ist reference site:
“There are two ways to create a new deployment for a cloud service. Either by specifying a local package or by specifying the url for a package in blob storage. I tried several times using the local package, but mostly the request timed out and the method didn’t prove be very reliable. That’s why I first included a step to upload the package to blob storage and then run the deploy from there.”
Reference links
https://www.kenneth-truyers.net/2014/02/06/deploying-cloud-services-to-azure-with-powershell/
http://www.intertech.com/Blog/publish-to-the-cloud-windows-azure-directly-from-visual-studio/
I think the give answer is correct.
If the package is upload to storage it can not be retained for DR or can be redeployed to other blobs.