What is indicated by the verb in a sentence and refers to the time of an action?

The term that refers to the time of an action in a sentence is tense. Tense is a grammatical category that expresses the timing of the action, indicating whether it occurs in the past, present, or future. For example, in the sentence "She walks," the verb "walks" is in the present tense, while in "She walked," the verb "walked" is in the past tense.

Understanding tense is crucial for effective communication, as it helps to clarify when an event happens relative to the moment of speaking. This role of indicating time is fundamental to the function of verbs in sentences, making "tense" the correct answer. Other grammatical elements like aspect, mood, and voice serve different functions; they do not specifically denote time but rather add nuances to the meaning of the action described by the verb.