- A
It manages the VXLAN multicast groups
Why wrong: Multicast group management may be done by the underlay, not the VTEP.
- B
It encapsulates and decapsulates VXLAN packets
VTEP is responsible for VXLAN encapsulation/decapsulation.
- C
It acts as a DHCP server for tenant VMs
Why wrong: DHCP is separate from VXLAN.
- D
It provides Layer 3 routing between VXLAN segments
Why wrong: Routing between VXLAN segments is done by a gateway, but VTEP performs encapsulation.
Question 435 of 1,000
350-601 Network Practice Question
This 350-601 practice question tests your understanding of network. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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.
In a VXLAN environment, what is the function of a VTEP?
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
✓
It encapsulates and decapsulates VXLAN packets
A VTEP (VXLAN Tunnel Endpoint) is the device that performs VXLAN encapsulation and decapsulation. It takes an original Layer 2 frame, adds a VXLAN header (with a VNI to identify the tenant segment), a UDP header (port 4789), and an outer IP/Ethernet header, then sends the packet over the underlay network. On the receiving side, the VTEP strips these headers and forwards the original frame to the destination host. This encapsulation/decapsulation function is the core purpose of a VTEP in a VXLAN environment.
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.
- ✗
It manages the VXLAN multicast groups
Why it's wrong here
Multicast group management may be done by the underlay, not the VTEP.
- ✓
It encapsulates and decapsulates VXLAN packets
Why this is correct
VTEP is responsible for VXLAN encapsulation/decapsulation.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
It acts as a DHCP server for tenant VMs
Why it's wrong here
DHCP is separate from VXLAN.
- ✗
It provides Layer 3 routing between VXLAN segments
Why it's wrong here
Routing between VXLAN segments is done by a gateway, but VTEP performs encapsulation.
Common exam traps
Common exam trap: answer the scenario, not the keyword
Cisco often tests the distinction between the VTEP's core encapsulation/decapsulation role and the separate functions of multicast group management, DHCP services, or Layer 3 routing, leading candidates to confuse the VTEP with a VXLAN gateway or a multicast router.
Detailed technical explanation
How to think about this question
Under the hood, a VTEP maintains a mapping table (either learned via multicast/BGP EVPN or statically configured) that associates a remote VTEP IP address with a given VNI and inner MAC address. In a real-world data center, VTEPs are often implemented on ToR switches or hypervisor vSwitches; when a VM sends a frame, the local VTEP checks its VXLAN table, encapsulates the frame, and forwards it to the correct remote VTEP. A subtle behavior is that if the destination MAC is unknown, the VTEP must flood the frame to all remote VTEPs in the same VNI (using multicast or head-end replication), which can impact performance if not properly designed.
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 practitioner preparing for the 350-601 exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
Got this wrong? Here's your next step.
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FAQ
Questions learners often ask
What does this 350-601 question test?
Network — This question tests Network — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: It encapsulates and decapsulates VXLAN packets — A VTEP (VXLAN Tunnel Endpoint) is the device that performs VXLAN encapsulation and decapsulation. It takes an original Layer 2 frame, adds a VXLAN header (with a VNI to identify the tenant segment), a UDP header (port 4789), and an outer IP/Ethernet header, then sends the packet over the underlay network. On the receiving side, the VTEP strips these headers and forwards the original frame to the destination host. This encapsulation/decapsulation function is the core purpose of a VTEP in a VXLAN environment.
What should I do if I get this 350-601 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
This 350-601 practice question is part of Courseiva's free Cisco certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the 350-601 exam.
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