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It looks like you are updating your build of Windows 10 to the latest version.
Apps are defined as applications that you personally downloaded and installed other then the apps that come with Windows. Personal Files are Documents, Music, Pictures, Videos etc
[Delete this reply please]
That screen is not from installing an update. You only get that screen when you run the Setup from install media (USB or .iso) from within Windows. It is for upgrading or reinstalling Windows.
The message at the bottom, just above the Back/Next buttons says the install media is for a different version of Windows from the one currently installed. That's why the "keep apps..." option is greyed out.