- A
Create an Azure Policy initiative that contains both policy definitions.
An initiative bundles multiple related policy definitions into a single assignable unit. That allows the team to manage the tag requirement and allowed-location requirement together as one governance package.
- B
Assign the initiative at the management group scope that contains the department subscriptions.
Management group scope lets the policy assignment apply across all department subscriptions consistently. This is the right place when the governance requirement must span multiple subscriptions under one organizational boundary.
- C
Use the Deny effect for both policy definitions.
Deny blocks noncompliant deployments at creation time, which is exactly what the team wants. It prevents resources from being deployed without the required tag or in disallowed regions.
- D
Grant Contributor at the subscription scope.
Why wrong: Contributor is an RBAC permission, not a policy control. It allows resource management but does not enforce tag or location compliance and does not block noncompliant deployments.
- E
Apply a CanNotDelete lock to each resource group.
Why wrong: Locks protect resources from deletion or modification, but they do not enforce deployment standards like required tags or approved locations. They solve a different governance problem.
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.
An operations team must enforce two rules across all subscriptions in a department: new resources must include a CostCenter tag, and deployments are allowed only in East US and West US. The team wants one assignment and automatic blocking of noncompliant deployments. Which three actions should the administrator take? Select three.
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
Create an Azure Policy initiative that contains both policy definitions.
Option A is correct because an Azure Policy initiative (a set of policy definitions) allows combining the CostCenter tag requirement and the allowed region restriction into a single assignment, simplifying management. This ensures both rules are enforced together across all subscriptions in the department.
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.
- ✓
Create an Azure Policy initiative that contains both policy definitions.
Why this is correct
An initiative bundles multiple related policy definitions into a single assignable unit. That allows the team to manage the tag requirement and allowed-location requirement together as one governance package.
Related concept
Read the scenario before looking for a memorised answer.
- ✓
Assign the initiative at the management group scope that contains the department subscriptions.
Why this is correct
Management group scope lets the policy assignment apply across all department subscriptions consistently. This is the right place when the governance requirement must span multiple subscriptions under one organizational boundary.
Related concept
Read the scenario before looking for a memorised answer.
- ✓
Use the Deny effect for both policy definitions.
Why this is correct
Deny blocks noncompliant deployments at creation time, which is exactly what the team wants. It prevents resources from being deployed without the required tag or in disallowed regions.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Grant Contributor at the subscription scope.
Why it's wrong here
Contributor is an RBAC permission, not a policy control. It allows resource management but does not enforce tag or location compliance and does not block noncompliant deployments.
- ✗
Apply a CanNotDelete lock to each resource group.
Why it's wrong here
Locks protect resources from deletion or modification, but they do not enforce deployment standards like required tags or approved locations. They solve a different governance problem.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse RBAC roles (like Contributor) with Azure Policy effects, mistakenly thinking granting permissions can enforce compliance, or they confuse resource locks with policy enforcement.
Detailed technical explanation
How to think about this question
Azure Policy uses the Deny effect to actively block noncompliant resource creation or update requests at the Azure Resource Manager (ARM) API level, before the resource is provisioned. Assigning the initiative at the management group scope ensures inheritance to all child subscriptions, providing centralized governance without per-subscription assignments. The Deny effect overrides any RBAC permissions, so even a Contributor cannot bypass the policy.
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.
- →
Manage Azure Identities and Governance — study guide chapter
Learn the concepts, then practise the questions
- →
Manage Azure Identities and Governance practice questions
Targeted practice on this topic area only
- →
All AZ-104 questions
1,170 questions across all exam domains
- →
AZ-104 study guide
Full concept coverage aligned to exam objectives
- →
AZ-104 practice test guide
How to use practice tests most effectively before exam day
Related practice questions
Related AZ-104 practice-question pages
Use these pages to review the topic behind this question. This is how one missed question becomes focused revision.
Manage Azure Identities and Governance practice questions
Practise AZ-104 questions linked to Manage Azure Identities and Governance.
Implement and Manage Storage practice questions
Practise AZ-104 questions linked to Implement and Manage Storage.
Deploy and Manage Azure Compute practice questions
Practise AZ-104 questions linked to Deploy and Manage Azure Compute.
Implement and Manage Virtual Networking practice questions
Practise AZ-104 questions linked to Implement and Manage Virtual Networking.
Monitor and Maintain Azure Resources practice questions
Practise AZ-104 questions linked to Monitor and Maintain Azure Resources.
AZ-104 Azure RBAC practice questions
Practise AZ-104 questions linked to AZ-104 Azure RBAC.
AZ-104 storage account practice questions
Practise AZ-104 questions linked to AZ-104 storage account.
AZ-104 virtual network practice questions
Practise AZ-104 questions linked to AZ-104 virtual network.
AZ-104 NSG practice questions
Practise AZ-104 questions linked to AZ-104 NSG.
AZ-104 Azure Monitor practice questions
Practise AZ-104 questions linked to AZ-104 Azure Monitor.
AZ-104 backup practice questions
Practise AZ-104 questions linked to AZ-104 backup.
AZ-104 managed identity practice questions
Practise AZ-104 questions linked to AZ-104 managed identity.
Practice this exam
Start a free AZ-104 practice session
Short sessions build daily habit. Longer sessions build exam-day stamina. Try a timed session to simulate real conditions.
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: Create an Azure Policy initiative that contains both policy definitions. — Option A is correct because an Azure Policy initiative (a set of policy definitions) allows combining the CostCenter tag requirement and the allowed region restriction into a single assignment, simplifying management. This ensures both rules are enforced together across all subscriptions in the department.
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
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 →
Keep practising
More AZ-104 practice questions
- A storage automation service principal must upload, read, and delete blob data in one container by using Microsoft Entra…
- A subnet contains several application servers. You need to allow inbound TCP 3389 only from a management subnet named Su…
- A subscription admin wants to investigate who changed a resource and also review the platform-generated events for that…
- Based on the exhibit, which Azure feature should the administrator use to track this kind of platform-wide service issue…
- An administrator wants a script running on an Azure VM to create a resource in Azure without storing any passwords or cl…
- A PowerShell script runs on an Azure VM every night and uses Azure CLI commands to create tags and VM resources in anoth…
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.
Question Discussion
Share a tip, memory trick, or ask about the reasoning behind this question. Do not post real exam questions, leaked content, braindumps, or copyrighted exam material. Comments are moderated and may be removed without notice.
Sign in to join the discussion.