Explanation
The correct statement about Free Software is that it may be modified by anyone using it. This is one of the four essential freedoms of Free Software, which are: the freedom to run the program as you wish, for any purpose; the freedom to study how the program works, and change it so it does your computing as you wish; the freedom to redistribute copies so you can help your neighbor; and the freedom to distribute copies of your modified versions to others1. Access to the source code is a precondition for these freedoms1.
The other statements are false for the following reasons:
* Free Software is not developed by volunteers only. It can be developed by anyone, including individuals, companies, organizations, or communities. Some Free Software developers are paid for their work, while others do it as a hobby or for social benefit1.
* Free Software does not have to be available free of charge. It can be sold or given away for any price. The term "free" refers to the users' freedom, not the price of the software1. However, Free Software users have the freedom to redistribute copies, so they can obtain the software at no charge from someone who has a copy1.
* Free Software does not only run on Linux. It can run on any operating system that supports it, such as Windows, MacOS, BSD, or Android. Linux is an example of a Free Software operating system, but not the only one1.
* Free Software is not only distributed as a compiled binary. It can also be distributed as source code, or both. In fact, Free Software must provide access to the source code, otherwise the users cannot study or modify the software1.
References:
* What is Free Software? - GNU Project - Free Software Foundation