The correct answer is Option (2) → at
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At is used to indicate a specific or precise location, such as an address or a specific point on a map. "The junction near the city hall" is a specific location.
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On is typically used for surfaces or to indicate something is situated on a line or street (e.g., "on the street," "on the corner"). While a junction has a surface, "at the junction" is more idiomatic for a specific point.
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Over indicates a position above something else.
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In is used for a larger, more general area (e.g., "in the city").
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