The answer is that the Azure Disk Encryption failure is most likely caused by the key version referenced in the policy becoming invalid due to key rotation. When a specific key version is pinned in the encryption policy, Azure Disk Encryption will attempt to use that exact version from Azure Key Vault; if the key has been rotated or archived, the old version is no longer valid for encryption operations, causing new VM deployments to fail. On the AZ-500 exam, this scenario tests your understanding of how key versioning interacts with Azure Disk Encryption policies—a common trap is assuming key rotation is always safe, but the exam emphasizes that the policy must be updated to reference the new version. Remember the memory tip: “Pinned version, pinned failure; update the version to avoid the failure.”
AZ-500 Secure compute, storage, and databases Practice Question
This AZ-500 practice question tests your understanding of secure compute, storage, and databases. The scenario asks you to isolate a root cause — eliminate options that address a different problem before choosing. 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.
Refer to the exhibit. You have an Azure Disk Encryption policy assignment. An administrator reports that encryption of a new VM fails. What is the most likely cause?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue: "most likely"
Why it matters: Probability qualifier — the question wants the most probable cause or outcome, not a guaranteed one. Eliminate low-probability options.
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
The key version referenced in the policy is no longer valid because the key was rotated.
The exhibit shows encryption configuration with keySource as Microsoft.Keyvault and a specific key version. If the key version is specified, Azure Disk Encryption will attempt to use that exact version. If the key is rotated or archived, the specified version becomes invalid. Option A is correct. Option B is incorrect because the key vault URI is present. Option C is incorrect because the key exists. Option D is incorrect because key rotation is not inherently a problem if the version is updated in the policy.
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.
✗
The disk encryption set does not have purge protection enabled.
Why it's wrong here
Purge protection is not required for encryption; it prevents permanent deletion of keys.
✓
The key version referenced in the policy is no longer valid because the key was rotated.
Why this is correct
Specifying a key version without updating it after rotation causes failures.
Clue confirmation
The clue word "most likely" in the question point toward this answer.
Related concept
Read the scenario before looking for a memorised answer.
✗
The key does not exist in the key vault.
Why it's wrong here
The key is named, so it likely exists; if missing, the error would be different.
✗
The key vault URI is incorrect or inaccessible.
Why it's wrong here
The URI appears valid; if it were incorrect, earlier VMs would have failed.
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 media company stores terabytes of video archives that are accessed once a year for audit purposes. Moving these objects to a cold storage tier (Azure Archive, S3 Glacier, or Google Nearline) costs a fraction of hot storage. Questions like this test whether you understand storage tiers, access frequency tradeoffs, and retrieval latency requirements.
Related glossary terms
Concepts from this question explained
These glossary pages explain the core terms tested in this AZ-500 question in full detail.
Identify which AZ-500 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.
Secure compute, storage, and databases — This question tests Secure compute, storage, and databases — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: The key version referenced in the policy is no longer valid because the key was rotated. — The exhibit shows encryption configuration with keySource as Microsoft.Keyvault and a specific key version. If the key version is specified, Azure Disk Encryption will attempt to use that exact version. If the key is rotated or archived, the specified version becomes invalid. Option A is correct. Option B is incorrect because the key vault URI is present. Option C is incorrect because the key exists. Option D is incorrect because key rotation is not inherently a problem if the version is updated in the policy.
What should I do if I get this AZ-500 question wrong?
Identify which AZ-500 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.
Are there clue words in this question I should notice?
Yes — watch for: "most likely". Probability qualifier — the question wants the most probable cause or outcome, not a guaranteed one. Eliminate low-probability options.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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