How does Packer interact with system images?

How does Packer interact with system images?
A . Packer has to be installed within the target image and is executed during the image’s first boot in order to execute preparation tasks.
B . Packer installs a client within the image which has to be run periodically via cron in order to retrieve the latest template from the Packer server and apply it locally.
C . Packer periodically connects through the network to the Packer daemons of all running Packer images in order to re-apply the whole template to the running instance.
D . Packer downloads and extracts an image in order to make changes to the image’s file system, repack the modified image and upload it again.
E . Packer creates an instance based on a source image, prepares the instance through a network connection and bundles the resulting instance as a new system image.

Answer: E