How can the developer incorporate the list of approved instance types in the CloudFormation template?

Explanations:

Creating a separate CloudFormation template for each EC2 instance type is not efficient, as it increases management complexity and doesn’t leverage the parameterization feature of CloudFormation, which allows reusability and flexibility.

Defining resources for each EC2 instance type in the Resources section would lead to an unnecessarily large template, making it difficult to manage and deploy, especially when there are many instance types. It doesn’t provide a flexible way to choose among multiple approved types.

Creating a separate parameter for each EC2 instance type makes the template unwieldy, especially if the list of approved instance types is long. It does not enforce the selection of allowed instance types, as users could potentially input any value.

Creating a parameter with the list of EC2 instance types as Allowed Values allows the developer to enforce that only approved instance types can be selected when launching the EC2 instances. This approach simplifies the template while ensuring compliance with the list of approved types.