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.