What does 'running in the cloud' basically mean?

The code of the app runs inside the browser of the user
Using servers and storage owned by a provider, rented on demand (Correct option)
Running the program without using any electricity at the office
Using only free and open source software for everything

Using computing resources (servers, storage, databases) owned and managed by a provider like AWS, Azure or GCP, rented on demand over the internet

Instead of buying and maintaining your own servers, you rent them by the hour or second and create them in minutes via a website or API.

Providers also offer managed services (databases, queues, storage) so you don't operate them yourself.

Benefits: scale up and down quickly, pay for what you use, global data centers.

Cloud = rented, on-demand infrastructure and services.