- A
Use an HTTP connector with 'Active Directory OAuth' authentication. Provide the client ID and client secret.
Why wrong: Incorrect: third-party API uses Basic, not OAuth.
- B
Use managed identity authentication on the HTTP connector. The third-party API must support managed identity.
Why wrong: Incorrect: third-party API does not support managed identity.
- C
Store the username and password directly in the Logic App's connection settings for the HTTP connector.
Why wrong: Incorrect: credentials would be stored in plaintext in Logic App definition.
- D
Add a Key Vault connector step to retrieve the secret containing the password. Then use an HTTP connector with 'Basic' authentication type. In the authentication parameters, reference the secret for the password.
Correct: retrieves password from Key Vault, uses Basic auth.
Quick Answer
The correct approach is to add a Key Vault connector step to retrieve the secret containing the password, then use an HTTP connector with Basic authentication, referencing that secret in the authentication parameters. This works because the Logic App’s system-assigned managed identity has already been granted Get permission on the Key Vault secrets, allowing secure retrieval without hardcoding credentials. The HTTP connector’s Basic authentication type then constructs the Authorization header using the retrieved username and password, ensuring the third-party API receives the proper credentials. On the AZ-204 exam, this scenario tests your understanding of securing integration workflows with Azure Logic App Basic authentication and Key Vault, often appearing as a trap where candidates mistakenly choose OAuth or store credentials in app configuration. A common memory tip: “Retrieve with Key Vault, then send with HTTP Basic—never embed secrets in the workflow.”
AZ-204 Practice Question: Connect to and consume Azure services and third-party services
This AZ-204 practice question tests your understanding of connect to and consume azure services and third-party services. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. 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.
Coho Vineyard has an Azure Logic App that processes orders. The workflow must call a third-party API that uses Basic authentication. The credentials (username and password) must be stored securely in Azure Key Vault. The Logic App uses a system-assigned managed identity. The managed identity has been granted 'Get' permission on the Key Vault secrets. Which approach should the team use to pass the credentials to the third-party API?
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
Add a Key Vault connector step to retrieve the secret containing the password. Then use an HTTP connector with 'Basic' authentication type. In the authentication parameters, reference the secret for the password.
Use an HTTP connector with Basic authentication. In the authentication settings, use 'Raw' authentication and construct the Basic header using the secret from Key Vault via a Key Vault connector. Option A is correct. Option B uses OAuth, not Basic. Option C stores credentials in Logic App config. Option D uses managed identity for the third-party, which is not supported.
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.
- ✗
Use an HTTP connector with 'Active Directory OAuth' authentication. Provide the client ID and client secret.
Why it's wrong here
Incorrect: third-party API uses Basic, not OAuth.
- ✗
Use managed identity authentication on the HTTP connector. The third-party API must support managed identity.
Why it's wrong here
Incorrect: third-party API does not support managed identity.
- ✗
Store the username and password directly in the Logic App's connection settings for the HTTP connector.
Why it's wrong here
Incorrect: credentials would be stored in plaintext in Logic App definition.
- ✓
Add a Key Vault connector step to retrieve the secret containing the password. Then use an HTTP connector with 'Basic' authentication type. In the authentication parameters, reference the secret for the password.
Why this is correct
Correct: retrieves password from Key Vault, uses Basic auth.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
Common exam trap: answer the scenario, not the keyword
Many certification questions include familiar terms but test a specific constraint. Read the exact wording before choosing an answer that is generally true but wrong for this case.
Detailed technical explanation
How to think about this question
This question should be treated as a scenario, not a definition check. Identify the problem, the constraint and the best action. Then compare each option against those facts.
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.
- Use explanations to understand the rule behind the answer.
TExam Day Tips
- Underline the problem statement mentally.
- 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 company's IT admin needs to give a contractor read-only access to production logs without sharing account credentials. Using role-based access control (RBAC) and temporary scoped permissions — not a permanent shared password — is the correct pattern. Questions like this test whether you can apply least-privilege access across cloud identity services.
What to study next
Got this wrong? Here's your next step.
Identify which AZ-204 exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
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Connect to and consume Azure services and third-party services — study guide chapter
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Connect to and consume Azure services and third-party services practice questions
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FAQ
Questions learners often ask
What does this AZ-204 question test?
Connect to and consume Azure services and third-party services — This question tests Connect to and consume Azure services and third-party services — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Add a Key Vault connector step to retrieve the secret containing the password. Then use an HTTP connector with 'Basic' authentication type. In the authentication parameters, reference the secret for the password. — Use an HTTP connector with Basic authentication. In the authentication settings, use 'Raw' authentication and construct the Basic header using the secret from Key Vault via a Key Vault connector. Option A is correct. Option B uses OAuth, not Basic. Option C stores credentials in Logic App config. Option D uses managed identity for the third-party, which is not supported.
What should I do if I get this AZ-204 question wrong?
Identify which AZ-204 exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
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 20, 2026
This AZ-204 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-204 exam.
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