CHALLENGE RESPONSE
What is Challenge Response Authentication?

Challenge-Response authentication is a group or family of protocols in which one party, typically the server, presents a challenge to another party, typically the client. The second party must respond with the appropriate answer to be authenticated.

A simple example of Challenge Response authentication is Security Questions. The challenge is from a server asking the user a question, the user must responde with the correct answer to the server so that the user can be served.