Your company is running a stateless application on a Compute Engine instance. The application is used heavily during regular business hours and lightly outside of business hours. Users are reporting that the application is slow during peak hours. You need to optimize the application's performance. What should you do?

The correct approach is to create a custom image from the existing disk, then an instance template from that custom image, and finally an autoscaled managed instance group (MIG) from the instance template. This allows the application to scale out automatically during peak hours and scale in during off-peak hours, addressing the performance issues. Creating a custom image ensures that all necessary application configurations and dependencies are captured. An instance template then defines the machine type, disk image (our custom image), and other instance properties for new instances. An autoscaled MIG uses this template to automatically create and delete instances based on demand, optimizing performance and cost. The other options are incorrect because they either involve unnecessary steps (e.g., creating a snapshot then a custom image from the snapshot, which is redundant if the goal is a custom image) or an illogical order of operations (e.g., creating an instance template from a disk directly, which isn't how templates are typically sourced for custom applications, or creating a custom image from an instance template, which reverses the logical flow).