Why am I prompted to install automatic updates? Are they automatic or not?

I have more information. I spoke with a senior tech support analyst at Apple. Apple's internal documentation is pretty much silent on this issue, and there are only hints about it on other forums. This is seemingly a feature of the M1 silicon, which apparently requires passwords more frequently and in more situations that Intel-based Mac's do. So, while macOS supports automatic updates for several things, including OS updates and Rapid Security Response updates, M1-based Macs do not. It will check for them and download them automatically if you want, but the settings for Installation are not functional. M1 owners have to install them manually and, yes, enter our administrator passwords to do it.

Thanks for the reply. I did read the article, and still think I have a problem. One of the types of updates specifically mentioned as being automatic is actually what provoked my post - Rapid Security Response. That one I was specifically asked to provide my password for, so basically not automatic, at least not the way I think of automatic and in the background. Stumped.