- A
Assign an initiative containing both policy definitions at the Corp management-group scope.
A management-group assignment applies the same governance to current and future subscriptions underneath it.
- B
Create a policy exemption for the pilot subscription.
An exemption lets one subscription bypass the assigned policy without weakening the rest of the hierarchy.
- C
Assign the policies individually at each resource group.
Why wrong: Per-resource-group assignments are harder to manage and do not automatically cover future subscriptions.
- D
Use the Owner role at the management-group scope.
Why wrong: RBAC roles control access, not compliance enforcement or deployment restrictions.
- E
Use a resource lock instead of Azure Policy.
Why wrong: Locks prevent certain changes, but they do not evaluate tags or allowed locations.
AZ-104 Manage Azure Identities and Governance Practice Question
This AZ-104 practice question tests your understanding of manage azure identities and governance. 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 department has 12 subscriptions under a management group named Corp. New resources must be deployed only in East US or West US and must include a CostCenter tag. A pilot subscription must be exempt from these rules during testing. Which two actions should you take? Select two.
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
Assign an initiative containing both policy definitions at the Corp management-group scope.
Option A is correct because assigning an initiative (a collection of policy definitions) at the Corp management-group scope ensures that all 12 subscriptions inherit both the location restriction and the CostCenter tag requirement. This is the most efficient and scalable way to enforce governance across multiple subscriptions without repeating assignments.
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.
- ✓
Assign an initiative containing both policy definitions at the Corp management-group scope.
Why this is correct
A management-group assignment applies the same governance to current and future subscriptions underneath it.
Related concept
Read the scenario before looking for a memorised answer.
- ✓
Create a policy exemption for the pilot subscription.
Why this is correct
An exemption lets one subscription bypass the assigned policy without weakening the rest of the hierarchy.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Assign the policies individually at each resource group.
Why it's wrong here
Per-resource-group assignments are harder to manage and do not automatically cover future subscriptions.
- ✗
Use the Owner role at the management-group scope.
Why it's wrong here
RBAC roles control access, not compliance enforcement or deployment restrictions.
- ✗
Use a resource lock instead of Azure Policy.
Why it's wrong here
Locks prevent certain changes, but they do not evaluate tags or allowed locations.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates may think individual policy assignments at each resource group (Option C) are acceptable, but Azure Policy is designed to be assigned at higher scopes (management group or subscription) for inheritance, and they may also confuse RBAC roles (Option D) with policy enforcement.
Detailed technical explanation
How to think about this question
An initiative definition (e.g., a custom or built-in policy set) can include multiple policy definitions, such as 'Allowed locations' and 'Require a tag on resources', which are evaluated during resource creation and existing resource compliance checks. Policy exemptions allow specific scopes (like the pilot subscription) to be excluded from enforcement while still being audited, using the exemption category 'Waiver' or 'Mitigated'. Under the hood, Azure Policy uses Azure Resource Manager (ARM) triggers to evaluate policies at deployment time and via periodic compliance scans.
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 startup's cloud architect reviews their monthly bill and notices costs are higher than expected for a long-running batch job. Switching from on-demand instances to Reserved Instances — or using Spot/Preemptible VMs — can reduce compute costs by up to 72 %. Questions like this test whether you understand the tradeoffs between commitment, flexibility, and cost across cloud pricing models.
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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FAQ
Questions learners often ask
What does this AZ-104 question test?
Manage Azure Identities and Governance — This question tests Manage Azure Identities and Governance — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Assign an initiative containing both policy definitions at the Corp management-group scope. — Option A is correct because assigning an initiative (a collection of policy definitions) at the Corp management-group scope ensures that all 12 subscriptions inherit both the location restriction and the CostCenter tag requirement. This is the most efficient and scalable way to enforce governance across multiple subscriptions without repeating assignments.
What should I do if I get this AZ-104 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
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Last reviewed: Jun 11, 2026
This AZ-104 practice question is part of Courseiva's free Microsoft 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 AZ-104 exam.
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