Option C applies the appropriate context-management technique. The issue is not simply whether the older conversation can physically fit into the context window; it is that stale details remain prominent enough to interfere with the model’s current task. Effective context engineering optimizes signal quality, not merely maximum token retention.

Anthropic’s context-editing documentation describes compaction as summarizing accumulated history and replacing the full history with a structured summary when context becomes large. This preserves important task state while substantially reducing low-value detail that can distract later reasoning.

A retains precisely the stale material producing the problem and therefore does not address context drift. B destroys all useful continuity between turns, including valid goals, decisions, and intermediate state. D is similarly excessive because limiting Claude to only the latest turn discards information that may still be required.

Compaction provides the correct middle ground: retain durable conclusions, current objectives, unresolved issues, and other high-signal state while compressing obsolete conversational detail. Relevant Study Guide topics: context engineering, compaction, conversation history, long-running agents, stale context, context drift, and high-signal state preservation.

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