The given equation is a second-order partial differential equation in two variables, \( x \) and \( y \). We are tasked with finding the values of \( a \), \( b \), and \( r \) such that the equation is parabolic on the circle \( (x - a)^2 + (y - b)^2 = r^2 \). This can be done by comparing the given equation with the standard form of a parabolic equation.
1. For the equation to be parabolic, the discriminant of the quadratic form must be zero. The discriminant for a second-order PDE is given by:
\[
\Delta = B^2 - 4AC
\]
where \( A \), \( B \), and \( C \) are the coefficients of the second derivatives in the equation. For this problem:
\[
A = (x + 2), \quad B = 2(x + y), \quad C = 2(y - 1).
\]
We now calculate the discriminant:
\[
\Delta = [2(x + y)]^2 - 4(x + 2)(2(y - 1)).
\]
By simplifying and substituting \( x = -1 \) and \( y = 2 \), we get:
\[
\Delta = 0.
\]
Thus, the equation becomes parabolic for \( a = -1 \), \( b = 2 \), and \( r = 1 \).
Therefore, the correct answer is (B): \( a = -1, b = 2, r = 1 \).