- A
AWS CloudHSM
Dedicated HSM for compliance with PCI DSS.
- B
AWS Key Management Service (KMS)
Why wrong: KMS is a managed service but does not provide dedicated HSM.
- C
AWS Secrets Manager
Why wrong: For managing secrets, not encryption keys.
- D
Amazon S3 server-side encryption (SSE-S3)
Why wrong: For S3 object encryption, not key management.
Question 1,345 of 1,746
SAP-C02 Design for New Solutions Practice Question
This SAP-C02 practice question tests your understanding of design for new solutions. Match the stated requirement to the specific cloud service, access model, or configuration option — many options are valid in isolation but not for this scenario. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A company is designing a new application that must meet PCI DSS compliance requirements. The application will process credit card transactions and store encrypted data. Which AWS service should be used to manage the encryption keys?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
AWS CloudHSM
AWS CloudHSM is the correct choice because PCI DSS requires that encryption keys used to protect cardholder data be stored in a hardware security module (HSM) that is FIPS 140-2 Level 3 validated, and that the customer retains sole control over the keys. CloudHSM provides dedicated, single-tenant HSM appliances that you manage directly, ensuring you meet the key management and physical security requirements of PCI DSS without sharing the HSM with other AWS customers.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
AWS CloudHSM
Why this is correct
Dedicated HSM for compliance with PCI DSS.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
AWS Key Management Service (KMS)
Why it's wrong here
KMS is a managed service but does not provide dedicated HSM.
- ✗
AWS Secrets Manager
Why it's wrong here
For managing secrets, not encryption keys.
- ✗
Amazon S3 server-side encryption (SSE-S3)
Why it's wrong here
For S3 object encryption, not key management.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse AWS KMS with CloudHSM because both manage encryption keys, but the exam specifically tests the PCI DSS requirement for FIPS 140-2 Level 3 validation and sole customer control of the HSM, which only CloudHSM provides.
Detailed technical explanation
How to think about this question
CloudHSM provides dedicated HSM instances that are FIPS 140-2 Level 3 validated, meaning the device is tamper-resistant and will zeroize keys upon physical intrusion. You manage the HSM via PKCS#11, Java JCE, or Microsoft CNG interfaces, and you can create, store, and use keys entirely within the HSM without AWS ever having access to the key material. In a real-world PCI DSS audit, you would need to demonstrate that key generation, storage, and deletion occur only on your CloudHSM, and that you have documented key management policies (e.g., key rotation every 12 months, split-knowledge for master keys).
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A media company stores terabytes of video archives that are accessed once a year for audit purposes. Moving these objects to a cold storage tier (Azure Archive, S3 Glacier, or Google Nearline) costs a fraction of hot storage. Questions like this test whether you understand storage tiers, access frequency tradeoffs, and retrieval latency requirements.
What to study next
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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Design for New Solutions — study guide chapter
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FAQ
Questions learners often ask
What does this SAP-C02 question test?
Design for New Solutions — This question tests Design for New Solutions — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: AWS CloudHSM — AWS CloudHSM is the correct choice because PCI DSS requires that encryption keys used to protect cardholder data be stored in a hardware security module (HSM) that is FIPS 140-2 Level 3 validated, and that the customer retains sole control over the keys. CloudHSM provides dedicated, single-tenant HSM appliances that you manage directly, ensuring you meet the key management and physical security requirements of PCI DSS without sharing the HSM with other AWS customers.
What should I do if I get this SAP-C02 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
Courseiva creates original exam-style practice questions with explanations and wrong-answer analysis. It does not publish real exam questions, exam dumps, or protected exam content. Learn why practice questions differ from exam dumps →
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Last reviewed: Jul 4, 2026
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