A company is using AWS CloudFormation to deploy a two-tier application.

This solution will meet the requirements by using AWS Secrets Manager, which is a service that helps protect secrets such as database credentials by encrypting them with AWS Key Management Service (AWS KMS) and enabling automatic rotation of secrets. The developer can use an AWS Secrets Manager resource in AWS CloudFormation template, which enables creating and managing secrets as part of a CloudFormation stack. The developer can use an AWS::SecretsManager::Secret resource type to generate and rotate the password for accessing RDS database during deployment. The developer can also specify a RotationSchedule property for the secret resource, which defines how often to rotate the secret and which Lambda function to use for rotation logic. Option A is not optimal because it will use an AWS Lambda function as a CloudFormation custom resource, which may introduce additional complexity and overhead for creating and managing a custom resource and implementing rotation logic. Option B is not optimal because it will use an AWS Systems Manager Parameter Store resource with the SecureString data type, which does not support automatic rotation of secrets. Option C is not optimal because it will use a cron daemon on the application’s host to generate and rotate the password, which may incur more costs and require more maintenance for running and securing a host.