To minimize the chance of passwords being captured one-time passwords would prevent a password sniffing attack because once used it is no longer valid. Encryption will also minimize these types of attacks.
The following answers are correct:
static and recurring passwords. This is incorrect because if there is no encryption then someone password sniffing would be able to capture the password much easier if it never changed.
encryption and recurring passwords. This is incorrect because while encryption helps, recurring passwords do nothing to minimize the risk of passwords being captured.
static and one-time passwords. This is incorrect because while one-time passwords will prevent these types of attacks, static passwords do nothing to minimize the risk of passwords being captured.