Final answer:
Gerald Ford pardoned Richard Nixon for his involvement in the Watergate scandal, an act that demonstrated the exercise of presidential executive privilege and power to grant pardons. The correct option is 2).
Step-by-step explanation:
The individual who pardoned all Watergate participants, revoked the pardon, testified before Congress, and invoked the power of executive privilege was Gerald Ford. Ford became the 38th president of the United States after Richard Nixon's resignation over the Watergate scandal.
One of Ford's most controversial decisions was granting a full pardon to Nixon for "crimes he committed or may have committed," involving the Watergate break-in and subsequent cover-up.
This pardon was an exercise of the president's executive power and could not be overridden by other branches of government according to the principle of executive privilege. Option 2) is the correct one.