What layer of the OS is responsible for executing applications and utilizing kernel services?

The application layer is the correct choice because it serves as the interface between the end-user applications and the underlying kernel services provided by the operating system. This layer is responsible for executing application code and managing user interactions. When applications are run, they utilize kernel services through system calls to access hardware resources, manage memory, and perform input/output operations.

In contrast, the kernel layer operates at a lower level, providing core functionalities of the operating system such as process management, memory management, and device communication, without directly executing user applications. The hardware layer refers to the physical components of the computer, and the system layer, while it may imply an overall structure, does not specifically pertain to the execution of applications or the use of kernel services.

Thus, in the context of operating system architecture, the application layer is indeed the component that embodies the execution of applications and their interaction with the kernel.