An operations team wants to label resources by Department and Environment so they can search and report on ownership across many resource groups. Which two statements are correct? Select two.

A ReadOnly lock is the best way to record department ownership.

A ReadOnly lock prevents changes, which is not the purpose of ownership metadata. Tags are the correct tool when you need labels and reporting.

Tags automatically encrypt the data in a resource.

Tags do not change the security posture or encryption state of a resource. They are metadata only and do not affect data protection features.

Tags replace Azure Policy when compliance must be enforced.

Tags can be checked or required by Azure Policy, but tags themselves do not enforce compliance. Policy is the enforcement feature, while tags are the metadata being managed.

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: Tags are key-value pairs that can be applied to resources and resource groups. — Tags are a lightweight way to attach searchable metadata such as Department and Environment to Azure resources. They help with inventory, ownership, and cost reporting across multiple resource groups. Because tags do not grant access, they should be used alongside RBAC and policy, not as a replacement for them. This makes them ideal for organization and reporting tasks. Why others are wrong: A ReadOnly lock is for blocking writes, not for recording ownership. Tags do not encrypt data or improve cryptographic protection. They also do not replace Azure Policy, because policy is the enforcement tool and tags are only metadata. The question is about search and reporting, so tags are the correct feature.

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.