(Which number of bits gets encrypted each time encryption is applied during stream encryption?

In the classical definition, a stream cipher encrypts data in very small units—often described as one bit at a time—by combining plaintext with a keystream (commonly via XOR). While many practical stream ciphers operate on bytes or words for efficiency, the conceptual distinction compared to block ciphers is that stream encryption processes data as a continuous stream rather than fixed-size blocks. This is why the standard teaching answer is “1 bit” per application of the keystream. Block ciphers, by contrast, encrypt blocks like 64 bits (DES/3DES) or 128 bits (AES) in each invocation of the block primitive. Options like 40, 192, and 256 are not typical stream cipher “per-step” processing sizes; 40 and 256 are often associated with key sizes, and 192 could be a key size for AES, not an encryption granularity. The essential security requirement for stream ciphers is that the keystream must be unpredictable and never reused with the same key/nonce combination; otherwise XOR properties allow attackers to recover relationships between plaintexts. Thus, the best answer is 1.