What is a key characteristic of the Application server in ABAP Database Integration?

The correct answer highlights a key characteristic of the Application server in ABAP Database Integration, which is its capability to interact with external databases. This feature is important because it allows developers to leverage data stored outside of the main SAP HANA database, enabling a broader range of data management and analysis opportunities. By utilizing external databases, applications can perform complex operations, access various data sources, and integrate functionality that combines SAP data with external data.

The Application server plays a central role in establishing connections to these external databases, managing data retrieval, and ensuring that the necessary transformations and logic are applied to integrate that data with the application's workflows. This enhances flexibility in data management, as it allows organizations to utilize existing data without needing to migrate everything into the SAP environment.

In contrast, the other options do not represent the primary purpose or characteristic of the Application server. While it is indeed linked to the client database, stating that it is “always linked” does not capture the broader capability of connecting to various databases. The management of data and handling of SQL connection settings are important tasks, but they are not as defining of the Application server’s role in enabling external database integration.