Step 1: Understanding the current distribution.
The sum of currents entering a junction is equal to the sum of currents leaving the junction (Kirchhoff's current law).
Given:
- The current entering the junction is \( 0.2 \, \text{A} + 0.5 \, \text{A} = 0.7 \, \text{A} \).
- The current leaving the junction is \( 0.4 \, \text{A} + 0.8 \, \text{A} = 1.2 \, \text{A} \).
To balance the current, we have:
\[
I = 0.7 \, \text{A}
\]
Thus, the correct answer is (A) 0.7 A.