How an automated menu telephone system works?

Answer 1

Its like setting up a customized greeting that will automatically answer the phone after few rings. Also adding on hold music that will entertain callers while on hold.

Before trying to answer your question I would like to add that there are 4 types of answering service: automated, live, internet, call center. Phone answering systems works by integrating a PBX with a PC. It intercept calls and forward a call to a live or automated receiver.

Answer 2

It's simply a computer program which waits for a response from the caller. Each level of menu option directs the call to another part of the computer program, until the final choice connects with an actual person.