HOTSPOT
Your company has a main office and two branch offices named Branch1 and Branch2. The main office contains
a file server named Server1 that has BranchCache enabled. Branch1 contains
a server named Server2 that is configured as a hosted cache server.
All client computers run Windows 8 Enterprise. All of the computers are joined to an Active Directory domain.
The BranchCache settings of all the computers are configured as shown in the following exhibit. (Click the
Exhibit button.)
In the table below, identify the effective setting for the client computers in each branch office. Make one
selection in each column. Each correct selection is worth one point.
Hot Area:
Answer: 
Explanation:
Both Server1 and Server2 will cache content for their local clients.
Note: BranchCache has two modes of operation:
Distributed cache mode: content cache at a branch office is distributed among client computers.
Hosted cache mode: content cache at a branch office is hosted on one or more server computers called
hosted cache servers.
https://blogs.technet.microsoft.com/canitpro/2013/05/13/step-by-step-enabling-branchcache-inmicrosoft-windows-server-2012/
What’s the correct answer?
Branch 2 Will retrieve content from peers. because of automatic hosted cache is enabled and distributed cache mode also enabled. so if client can not find any hosted cache server (branch 2 client will not find) they use distributed cache mode.
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