A Z E B I Y O

We are looking for the 8th term.

Look at the odd numbered terms.  They are:

A,E,I,O

That's obviously the vowels A,E,I,O,U and the next odd 
term will be the last vowel U.  That will be the 9th
term.  Since the sequence of odd terms is the sequence 
of vowels, that tells us that the pattern for the 
sequence of odd terms is independent of the sequence 
of even terms.   

So the sequence goes

A Z E B I Y O ? U

Now look at the even numbered terms.  They are:

Z,B,Y,

That looks like the sequence Z,B,Y,C,X,D,W, with this pattern:

Z = unused letter closest to the end of the alphabet.
B = unused letter closest to the front of the alphabet.
Y = unused letter closest to the end of the alphabet.
C = unused letter closest to the front of the alphabet.
X = unused letter closest to the end of the alphabet.
D = unused letter closest to the front of the alphabet.
W = unused letter closest to the end of the alphabet.
E = unused letter closest to the front of the alphabet.
etc.

So the letter that goes 8th (where the question mark is) is C:

A Z E B I Y O C U

So the answer is C. 

Edwin