This example shows how FastAPI apps manage environment variables using Pydantic's BaseSettings. When the app starts, it creates a Settings instance that reads environment variables like APP_NAME. This value is then used to set the FastAPI app's title. The execution table traces these steps: creating settings, reading env vars, setting app title, and running the app. Variables like settings.app_name and app.title update accordingly. Beginners often wonder why settings.app_name gets its value automatically; this is because BaseSettings reads matching environment variables. If APP_NAME is missing, the app will raise an error unless a default is provided. The visual quiz tests understanding of these steps and variable values. This approach keeps configuration clean and secure by separating code from environment-specific data.