Models an appropriate response to a feared stimulus in graduated steps, after which the client attempts to imitate the model step-by-step, encouraged and supported by the therapist.

The correct answer is participant modeling. 

Participant modeling refers to a psychotherapy technique in which a therapist models or demonstrates to their client how to respond to a fear provoking stimulus in gradual steps. After this, the client is encouraged to imitate the therapist's modeled behavior step-by-step so that he or she can learn how to cope with the fear provoking stimulus when faced with it outside a therapy setting.