Quick Answer
The correct actions are to scale down to a lower service tier and use reserved capacity. Scaling down directly reduces compute costs by moving an underutilized database to a lower DTU or vCore tier, eliminating waste from over-provisioned resources. Reserved capacity, meanwhile, locks in a one- or three-year commitment for a specific service tier and region, offering significant discounts over pay-as-you-go pricing. On the AZ-204 exam, this scenario tests your ability to apply cost optimization strategies within Azure SQL Database, often appearing as a multi-select question where the distractors—like enabling geo-replication or read scale-out—are legitimate features but add cost rather than reduce it. A common trap is confusing performance scaling with cost scaling; remember that scaling down reduces cost, while scaling up or adding features increases it. For a quick memory tip, think "Down and Reserve" to recall the two cost-saving actions: scale down the tier and reserve the capacity.
This AZ-204 practice question tests your understanding of monitor, troubleshoot, and optimize azure solutions. 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.
Which TWO actions should you take to optimize costs for an Azure SQL Database that is underutilized? (Choose two.)
Enable geo-replication
Why wrong: Geo-replication incurs additional costs.
Increase the DTU or vCore limit
Why wrong: Increasing limits increases cost.
Purchase reserved capacity
Reserved capacity provides significant discounts.
Enable read scale-out
Why wrong: Read scale-out requires additional replicas and increases cost.
Scale down to a lower service tier
Scaling down reduces compute costs.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Purchase reserved capacity
Option B (scale down) and Option D (use reserved capacity) are correct because scaling down reduces compute costs and reserved capacity offers discounts. Option A (increase DTU) increases cost. Option C (geo-replication) adds cost. Option E (read scale-out) adds cost.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Enable geo-replication
Why it's wrong here
Geo-replication incurs additional costs.
Increase the DTU or vCore limit
Why it's wrong here
Increasing limits increases cost.
Purchase reserved capacity
Why this is correct
Reserved capacity provides significant discounts.
Related concept
Read the scenario before looking for a memorised answer.
Enable read scale-out
Why it's wrong here
Read scale-out requires additional replicas and increases cost.
Scale down to a lower service tier
Why this is correct
Scaling down reduces compute costs.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
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
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.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
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
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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FAQ
Monitor, troubleshoot, and optimize Azure solutions — This question tests Monitor, troubleshoot, and optimize Azure solutions — Read the scenario before looking for a memorised answer..
The correct answer is: Purchase reserved capacity — Option B (scale down) and Option D (use reserved capacity) are correct because scaling down reduces compute costs and reserved capacity offers discounts. Option A (increase DTU) increases cost. Option C (geo-replication) adds cost. Option E (read scale-out) adds cost.
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.
Read the scenario before looking for a memorised answer.
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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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