Common App Preferrred Admission

I am applying for UofM using thecommonapp for mechanical engineering. In the academics section, it says preferred admissions and gives me the options:
School of Information
Ross School of Business
Not applying for Preferred Admission
I just wanted to know what this is.

At Umich most students apply for the business school during their sophomore year. Preferred admission is a way for really competitive high school applicants to reserve their spot at Ross so that they do not have to reapply during their freshman year of college.

^