A.I. Explanation:

Correct answer: applied

Explanation: The word 'applied' is the past participle of the verb 'apply,' which fits grammatically as it describes how the principles are being utilized in different ways. The context indicates that these principles are actively being put into practice, aligning with the ongoing relevance of management theories.

Meaning: 'Applied' means to put something into practical use or action.

Wrong options:

• sensitive: 'Sensitive' is an adjective that describes a state of being easily affected, which does not fit the context of how principles are used.
• updating: 'Updating' is a gerund that implies making something current, but it does not convey the idea of using principles in practice.
• degree: 'Degree' is a noun that refers to a level or amount, which does not fit as it does not describe an action related to the principles.
• advances: 'Advances' is a noun that refers to progress or improvements, which does not fit as it does not describe how principles are utilized.

Correct answer: advances

Explanation: The term 'advances' refers to improvements or developments in technology and social psychology. It fits grammatically as a plural noun that complements the context of discussing progress in these fields, which informs management theory.

Meaning: 'Advances' means improvements or progress made in a particular area.

Wrong options:

• sensitive: 'Sensitive' does not fit as it describes a quality rather than a development or improvement.
• specialized: 'Specialized' is an adjective that describes something tailored for a specific purpose, which does not fit as it does not refer to progress in technology or psychology.
• updating: 'Updating' is a gerund that implies making something current, which does not fit the context of describing improvements.

Correct answer: specialized

Explanation: The word 'specialized' is an adjective that describes management theory as being tailored or focused on specific areas to address challenges. This fits grammatically and contextually, as it indicates a shift in management practices to meet specific needs.

Meaning: 'Specialized' means designed or trained for a particular purpose or area.

Wrong options:

• sensitive: 'Sensitive' describes a quality of being easily affected, which does not fit the context of describing management theory.
• advances: 'Advances' is a noun that refers to improvements, which does not fit as it does not describe the nature of management theory.
• arising: 'Arising' is a verb form that does not fit grammatically as it does not describe the characteristics of management theory.

Correct answer: arising

Explanation: The word 'arising' is a present participle that describes challenges that are emerging or coming up. It fits grammatically as it indicates ongoing challenges that organizations face, aligning with the context of a dynamic global economy.

Meaning: 'Arising' means coming into being or emerging.

Wrong options:

• sensitive: 'Sensitive' describes a quality rather than a type of challenge, which does not fit the context.
• degree: 'Degree' is a noun that refers to a level or extent, which does not fit as it does not describe challenges.
• specialized: 'Specialized' is an adjective that does not fit as it does not describe the nature of challenges organizations face.