Final answer:
The Camp David Accords, brokered by President Carter, resulted in Egypt recognizing Israel and Israel returning the Sinai Peninsula to Egypt, marking a pivotal step towards peace in the Middle East.
Step-by-step explanation:
The limited compromise achieved at the summit hosted by President Carter at Camp David in 1978, known as the Camp David Accords, was significant in the history of Middle Eastern politics. The agreement was a result of thirteen days of intense negotiations, which culminated in historic decisions by both Egypt and Israel. The correct compromise described in the options provided to the student is: Sadat would recognize Israel; Israel would return the Sinai Peninsula to Egypt. As part of the accords, Egyptian President Anwar Sadat agreed to become the first Arabic nation to officially recognize the State of Israel, and Israeli Prime Minister Menachem Begin agreed to the return of the Sinai Peninsula to Egypt. The Camp David Accords were a milestone because they represented the first time an Arab country recognized Israel and agreed to peace. Although the agreement did not resolve all issues in the region, it laid a foundation for future diplomacy and stability in the Middle East.