How does a DHCP server dynamically assign IP address to host?

• Addresses are permanently assigned so that the host uses the same address at all times
• Addresses are leased to host A host will usually keep the same address by periodically contacting the DHCP sever to renew the lease Correct
• Addresses are assigned for a fixed period of time At the end of period, a new quest for an address must be made, and another address is then assigned
• Addresses are allocated after a negotiation between the server and the host to determine the length of the agreement