A company creates new Azure subscriptions every month. Central IT wants all production subscriptions to inherit the same governance baseline automatically, while sandbox subscriptions remain separate. What should the administrator implement?

Apply all governance controls individually to each new subscription after it is created.

This is operationally expensive and risks inconsistent configuration as subscriptions grow.

Use a resource lock on the subscription root.

Locks are not designed for hierarchical organization or for enforcing a reusable governance baseline.

Place all resources into one shared resource group per business unit.

Resource groups are too narrow for subscription-level governance and do not solve subscription inheritance.

What does this AZ-104 question test?

Read the scenario before looking for a memorised answer.

What is the correct answer to this question?

The correct answer is: Organize subscriptions under management groups and assign the baseline at the appropriate management group. — Management groups are the correct organizational layer when governance must apply consistently across multiple subscriptions. By placing production subscriptions under a production management group and assigning controls there, central IT can enforce standards once and have them inherited by any new subscription added later. This keeps boundaries clear between production and sandbox while reducing repetitive administration and the chance of missed configuration. Why others are wrong: Option A scales poorly and leaves room for inconsistent manual setup. Option C is not an organizational mechanism and does not provide governance inheritance. Option D works at the resource level, not the subscription level, so it cannot represent separate administrative boundaries or policy inheritance for many subscriptions.

What should I do if I get this AZ-104 question wrong?

Then try more questions from the same exam bank and focus on understanding why the wrong options are tempting.