Answer: D
The acetoxy oxygen attacks the C-OTs carbon from the back, giving a cis-fused dioxolanylium (acetoxonium) ion. This ion has a mirror plane, so its two ring carbons are equivalent enantiotopic sites. Acetate attacks either carbon from the back with equal probability; attack at the original carbon gives retention, attack at the other gives the mirror-image diacetate. The product is the racemic trans-diacetate ((1R,2R) and (1S,2S) in equal amounts).