A camera with a fixed iris is best mounted outside in a shadowed position. Fixed iris lenses do not adjust to changes in light levels, making them less suitable for environments with varying lighting conditions. By placing the camera in a shadowed position, you minimize the impact of direct sunlight and glare, which can cause overexposure and poor image quality. Therefore, the correct answer is C. For more detailed information, refer to Axis Communications' documentation on camera installation and fixed iris lenses.