What is the right course of action?

Your answer is correct because both braking and increasing the distance to the vehicle moving into your lane are essential defensive driving measures. According to German traffic rules, when another vehicle unexpectedly pulls out or merges into your lane, you must reduce speed by braking to avoid a collision. At the same time, increasing the distance to the vehicle ahead helps create a safety buffer, giving you more time and space to react to sudden hazards. Maintaining your speed (option 3) would be dangerous in such situations because it reduces your ability to stop or avoid an obstacle quickly. The combination of braking and increasing distance ensures safe and responsible driving in unexpected or hazardous traffic conditions.