Many times when a connection is opened, the firewall will inspect all layers of the packet. While this inspection is scaled back for subsequent packets to improve performance, this is the best of the four answers.
When packet filtering is used, a packet arrives at the firewall, and it runs through its ACLs to determine whether this packet should be allowed or denied. If the packet is allowed, it is passed on to the destination host, or to another network device, and the packet filtering device forgets about the packet. This is different from stateful inspection, which remembers and keeps track of what packets went where until each particular connection is closed. A stateful firewall is like a nosy neighbor who gets into people’s business and conversations. She keeps track of the suspicious cars that come into the neighborhood, who is out of town for the week, and the postman who stays a little too long at the neighbor lady’s house. This can be annoying until your house is burglarized. Then you and the police will want to talk to the nosy neighbor, because she knows everything going on in the neighborhood and would be the one most likely to know something unusual happened.
“Inspected at only one Open Systems Interconnetion (OSI) layer” is incorrect. To perform stateful packet inspection, the firewall must consider at least the network and transport layers.
“Decapsulated at all Open Systems Interconnection (OSI) layers” is incorrect. The headers are not stripped (“decapsulated” if there is such a word) and are passed through in their entirety IF the packet is passed.
“Encapsulated at all Open Systems Interconnect (OSI) layers” is incorrect. Encapsulation refers to the adding of a layer’s header/trailer to the information received from the above level. This is done when the packet is assembled not at the firewall.
Reference(s) used for this question: CBK, p. 466 Harris, Shon (2012-10-25). CISSP All-in-One Exam Guide, 6th Edition (pp. 632-633). McGraw-Hill. Kindle Edition.