- A
Deny
Deny is the correct enforcement effect when you want Azure to stop noncompliant deployments, such as resources created outside the approved regions.
- B
Audit
Audit records noncompliance without blocking the resource operation. That makes it appropriate for reporting existing resources missing the CostCenter tag.
- C
Modify
Why wrong: Modify is used to change supported resource properties during deployment. It does not directly express the requirement to block disallowed regions or simply report missing tags.
- D
DeployIfNotExists
Why wrong: DeployIfNotExists is for remediating missing child resources or settings, not for preventing resource creation in an unapproved region.
- E
Disabled
Why wrong: Disabled turns the policy effect off, so it would not enforce regions or record noncompliant resources. It defeats the stated governance requirement.
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 subscription must block creation of resources in any region except East US and West US, and the security team also wants a nonblocking report of existing resources that are missing a CostCenter tag. Which two Azure Policy effects should you use? 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
Deny
Deny is correct because it actively blocks resource creation in regions outside East US and West US by evaluating the location property against an allowed list and rejecting non-compliant requests at deployment time. Audit is correct because it logs a compliance event for existing resources missing the CostCenter tag without blocking any operations, providing a nonblocking report for the security team.
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.
- ✓
Deny
Why this is correct
Deny is the correct enforcement effect when you want Azure to stop noncompliant deployments, such as resources created outside the approved regions.
Related concept
Read the scenario before looking for a memorised answer.
- ✓
Audit
Why this is correct
Audit records noncompliance without blocking the resource operation. That makes it appropriate for reporting existing resources missing the CostCenter tag.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Modify
Why it's wrong here
Modify is used to change supported resource properties during deployment. It does not directly express the requirement to block disallowed regions or simply report missing tags.
When this WOULD be correct
Use Modify when you need to automatically add or change a tag (e.g., CostCenter) on existing or newly created resources to enforce compliance, such as ensuring all resources have a required tag value.
- ✗
DeployIfNotExists
Why it's wrong here
DeployIfNotExists is for remediating missing child resources or settings, not for preventing resource creation in an unapproved region.
When this WOULD be correct
DeployIfNotExists would be correct if the requirement was to automatically deploy a CostCenter tag with a default value to any existing resource that lacks it, and the policy should also evaluate and remediate non-compliant resources.
- ✗
Disabled
Why it's wrong here
Disabled turns the policy effect off, so it would not enforce regions or record noncompliant resources. It defeats the stated governance requirement.
When this WOULD be correct
If a question asks you to temporarily deactivate a policy without deleting it (e.g., during maintenance or testing), you would set the policy effect to Disabled.
Option-by-option analysis
Why each answer is right or wrong
Understanding why wrong answers are wrong — and when they would be correct — is what separates a 750 score from a 900. The AZ-104 exam frequently reuses these exact scenarios with slightly different constraints.
✓DenyCorrect answer▾
Why this is correct
Deny is the correct enforcement effect when you want Azure to stop noncompliant deployments, such as resources created outside the approved regions.
✗ModifyWrong answer — click to see why▾
Why this is wrong here
Modify effect automatically changes non-compliant resources, but the requirement is to block creation in disallowed regions and only report missing CostCenter tags without remediation.
★ When this WOULD be the correct answer
Use Modify when you need to automatically add or change a tag (e.g., CostCenter) on existing or newly created resources to enforce compliance, such as ensuring all resources have a required tag value.
Why candidates choose this
Candidates may think Modify can both block and auto-correct, but it doesn't block creation; it only alters resources after creation, and the question explicitly wants a nonblocking report for missing tags.
✗DeployIfNotExistsWrong answer — click to see why▾
Why this is wrong here
DeployIfNotExists is used to deploy resources (like a policy remediation task) when a non-compliant resource exists, but the requirement is only to report (non-blocking) missing CostCenter tags, not to automatically deploy a tag or resource.
★ When this WOULD be the correct answer
DeployIfNotExists would be correct if the requirement was to automatically deploy a CostCenter tag with a default value to any existing resource that lacks it, and the policy should also evaluate and remediate non-compliant resources.
Why candidates choose this
Candidates may confuse DeployIfNotExists with Audit, thinking it can both report and automatically fix missing tags, but the question explicitly asks for a non-blocking report, not remediation.
✗DisabledWrong answer — click to see why▾
Why this is wrong here
The Disabled effect turns off a policy definition entirely, so it cannot block resource creation in restricted regions or generate a nonblocking report of untagged resources.
★ When this WOULD be the correct answer
If a question asks you to temporarily deactivate a policy without deleting it (e.g., during maintenance or testing), you would set the policy effect to Disabled.
Why candidates choose this
Candidates may think 'Disabled' is a valid effect for a policy that should not enforce anything, but the question requires both blocking and auditing, which need active effects.
Analysis generated from the official AZ-104blueprint and verified against question context. The “when correct” sections are what AI assistants cite when candidates ask “what’s the difference between these options?”
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse Audit (which only reports) with DeployIfNotExists or Modify (which actively remediate), leading them to select a remediation effect when the question explicitly asks for a nonblocking report.
Detailed technical explanation
How to think about this question
Under the hood, Azure Policy uses a JSON-based policy definition with an 'if/then' structure; the Deny effect triggers a 403 Forbidden response during resource creation via Azure Resource Manager, while Audit writes a compliance state of 'NonCompliant' to the policy evaluation logs without altering the resource. In real-world scenarios, combining Deny for region control and Audit for tag reporting allows security teams to enforce strict boundaries while gathering data for future remediation without disrupting existing workloads.
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.
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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: Deny — Deny is correct because it actively blocks resource creation in regions outside East US and West US by evaluating the location property against an allowed list and rejecting non-compliant requests at deployment time. Audit is correct because it logs a compliance event for existing resources missing the CostCenter tag without blocking any operations, providing a nonblocking report for the security team.
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 →
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Last reviewed: Jun 11, 2026
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