Answer: You are correct. It is the upper-right corner.
This diagram shows the regression line (aka line of best fit), to be closest to all of the data points. It won't go through all of the data points, but it is the next best thing by getting as close as possible.
Something like the lower right corner shows the line only going through one point and it's not really close to the majority of the other points. It's close to only one or two points, and that's about it. The lower left corner is a similar story.
The upper left corner is fairly close, but the upper points are being left out. We should shift the regression line upward to make it look like what is shown in the upper right corner. We can think of it like a balancing act.
