AZ-104 Manage Azure Identities and Governance Practice Question
Three VMs run the same batch app and should use the same Azure identity to read blobs. The identity should remain available even if one VM is deleted. Which identity should you use?
⚠ Common exam trap
Candidates often choose system-assigned managed identity (Option B) because it is simpler to set up, but they overlook the requirement that the identity must survive VM deletion, which only a user-assigned identity guarantees.
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
✓
User-assigned managed identity
C is correct because a user-assigned managed identity is an independent Azure resource that persists even if a specific VM is deleted. This allows multiple VMs to share the same identity to authenticate to Azure Blob Storage, ensuring continuous access to blobs as long as at least one VM remains.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Shared access signature (SAS) token
Why it's wrong here
A shared access signature (SAS) token is not an identity at all; it's a cryptographically signed URI that grants temporary, delegated access to specific storage resources (for example, a blob or queue). When a SAS is scoped to a service, container, or object, it is a bearer credential that anyone with the token can use, and it must be carefully managed and rotated. It also only works for Azure Storage data access, not as a general Azure AD identity for the batch app to authenticate to other Azure services.
When this WOULD be correct
A question where you need to grant time-limited, delegated access to a specific blob or container without using an Azure AD identity, such as providing temporary read access to a storage resource for an external application or user.
- ✗
System-assigned managed identity
Why it's wrong here
Each VM with a system-assigned managed identity gets its own unique Azure AD identity, created and deleted with that specific VM. These identities are independent of each other, so the three VMs would not share the same security principal — you would have to assign identical role permissions to each VM's identity separately. If any VM is deallocated and deleted, its identity disappears, breaking the "same identity" requirement for the remaining VMs.
When this WOULD be correct
A question where a single VM needs to access Azure resources without managing credentials, and the identity should be automatically deleted when the VM is deleted (e.g., for a temporary VM).
- ✓
User-assigned managed identity
Why this is correct
A user-assigned managed identity is a standalone Azure AD identity that can be assigned to multiple Azure resources at the same time, including these three VMs. It remains available even if one VM is deleted, so all VMs keep the same identity and permission set without any reconfiguration. This makes it the correct choice because the batch app on each VM can authenticate to Azure services (such as Key Vault or Storage) with the same principal and grant once.
- ✗
Storage account shared key
Why it's wrong here
The storage account shared key is an account-level password that grants full administrative access to all services within a storage account, including blobs, tables, queues, and files. It is not an identity principal and cannot be used by a VM to authenticate as a service principal to Azure AD-backed APIs. Because the same key would give each VM complete, unrestricted access to the entire storage account, it violates least-privilege principles and is not designed for an application identity scenario.
When this WOULD be correct
In a scenario where a single application needs to access storage with full account-level permissions and you want to avoid managing identities or tokens, using a storage account shared key would be correct. For example, a legacy on-premises application that cannot use Azure AD authentication.
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.
✓User-assigned managed identityCorrect answer▾
Why this is correct
A user-assigned managed identity is a standalone Azure AD identity that can be assigned to multiple Azure resources at the same time, including these three VMs. It remains available even if one VM is deleted, so all VMs keep the same identity and permission set without any reconfiguration. This makes it the correct choice because the batch app on each VM can authenticate to Azure services (such as Key Vault or Storage) with the same principal and grant once.
✗Shared access signature (SAS) tokenWrong answer — click to see why▾
Why this is wrong here
A SAS token is tied to a specific storage account and can be revoked or expire, but it is not an Azure identity that can be assigned to VMs. It does not persist independently of VMs and cannot be used as a shared identity across multiple VMs that remains available if one VM is deleted.
★ When this WOULD be the correct answer
A question where you need to grant time-limited, delegated access to a specific blob or container without using an Azure AD identity, such as providing temporary read access to a storage resource for an external application or user.
Why candidates choose this
Candidates may think SAS tokens can be used for VM access to storage because they are a common method for granting access, but they are not designed for VM identity scenarios and lack the lifecycle management of managed identities.
✗System-assigned managed identityWrong answer — click to see why▾
Why this is wrong here
A system-assigned managed identity is tied to a single VM and is deleted when that VM is deleted, so it would not remain available if one VM is removed.
★ When this WOULD be the correct answer
A question where a single VM needs to access Azure resources without managing credentials, and the identity should be automatically deleted when the VM is deleted (e.g., for a temporary VM).
Why candidates choose this
Candidates may think system-assigned managed identities are automatically managed and assume they persist across VMs, not realizing they are scoped to a single resource.
✗Storage account shared keyWrong answer — click to see why▾
Why this is wrong here
A storage account shared key provides full access to the storage account and is not tied to a specific identity; it cannot be scoped to only the VMs and would remain valid even if a VM is deleted, but it does not meet the requirement of using an Azure identity for the batch app.
★ When this WOULD be the correct answer
In a scenario where a single application needs to access storage with full account-level permissions and you want to avoid managing identities or tokens, using a storage account shared key would be correct. For example, a legacy on-premises application that cannot use Azure AD authentication.
Why candidates choose this
Candidates may think a shared key is simpler to implement and always available, overlooking the requirement for an Azure identity and the security best practice of using managed identities.
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?”
Quick reference
Azure Blob Storage Tier Comparison
| Tier | Storage Cost | Retrieval Cost | Latency | Use Case |
|---|---|---|---|---|
| Hot | Highest | Lowest | Immediate | Active data, frequent reads |
| Cool | Lower | Higher | Immediate | Data accessed < once / month |
| Cold | Lower still | Higher | Immediate | Data accessed < once / quarter |
| Archive | Lowest | Highest + rehydration delay | Hours | Long-term compliance retention |
Go deeper
Related to this question
Learn chapter
Privileged Identity Management (PIM)
Key term
Blob storage
Blob storage is a cloud service for storing large amounts of unstructured data, such as text or binary data, like documents, images, and videos.
Key term
Blob
A blob is a large piece of unstructured data, like a photo or video, stored in the cloud with a unique identifier.
About these practice questions
Courseiva writes every AZ-104 question from scratch — 1,049 in total, each with an explanation and a wrong-answer breakdown. None are copied from real exams or dumps. Learn why practice questions differ from exam dumps →
JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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.