- A
Sensitivity label
The sensitivity label must be created with the desired protection settings (e.g., 'Confidential' and encryption).
- B
Auto-labeling policy
The auto-labeling policy specifies the locations (SharePoint) and conditions (credit card number) to automatically apply the sensitivity label.
- C
Data Loss Prevention (DLP) policy
Why wrong: DLP policies can block or protect content but do not automatically apply sensitivity labels; they are used for enforcement actions.
- D
Retention label policy
Why wrong: Retention labels manage data lifecycle (retention/deletion), not content classification and encryption.
MS-102 Manage compliance by using Microsoft Purview Practice Question
This MS-102 practice question tests your understanding of manage compliance by using microsoft purview. 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. A key principle to apply: sensitivity labels classify and protect data across Microsoft 365 services.. 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 compliance officer needs to automatically apply a sensitivity label to all documents in SharePoint Online that contain a credit card number. The label must mark the document as 'Confidential' and encrypt it. Which two Microsoft Purview components must be configured to achieve automatic labeling based on sensitive content? (Choose 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
Sensitivity label
Sensitivity labels define the classification and protection settings (e.g., 'Confidential' marking and encryption). Auto-labeling policies automatically apply those labels to documents containing sensitive information types, such as credit card numbers, without requiring user intervention. Together, they enable automatic labeling based on sensitive content in SharePoint Online.
Key principle: Sensitivity labels classify and protect data across Microsoft 365 services.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Sensitivity label
Why this is correct
The sensitivity label must be created with the desired protection settings (e.g., 'Confidential' and encryption).
Related concept
Sensitivity labels classify and protect data across Microsoft 365 services.
- ✓
Auto-labeling policy
Why this is correct
The auto-labeling policy specifies the locations (SharePoint) and conditions (credit card number) to automatically apply the sensitivity label.
Related concept
Sensitivity labels classify and protect data across Microsoft 365 services.
- ✗
Data Loss Prevention (DLP) policy
Why it's wrong here
DLP policies can block or protect content but do not automatically apply sensitivity labels; they are used for enforcement actions.
- ✗
Retention label policy
Why it's wrong here
Retention labels manage data lifecycle (retention/deletion), not content classification and encryption.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse DLP policies with auto-labeling policies, but DLP policies only monitor and block data movement, while auto-labeling policies are the correct mechanism to automatically apply sensitivity labels based on content detection.
Detailed technical explanation
How to think about this question
Auto-labeling policies use the Microsoft 365 built-in sensitive information type for credit card numbers (e.g., regex-based pattern matching with Luhn check) to trigger label application. The sensitivity label must be published and configured with encryption settings (e.g., 'Assign permissions now' or 'Let users assign permissions') before the auto-labeling policy can enforce it. In SharePoint, the label is applied at the item level, and encryption is enforced via Azure Rights Management (Azure RMS) with a usage restriction template.
KKey Concepts to Remember
- Sensitivity labels classify and protect data across Microsoft 365 services.
- They can apply encryption, visual markings, and access restrictions.
- Labels are created and configured in the Microsoft Purview compliance portal.
- A sensitivity label defines the 'what' of protection (e.g., 'Confidential' and encryption).
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
Sensitivity labels classify and protect data across Microsoft 365 services.
Real-world example
How this comes up in practice
A cloud solutions architect for a retail company is evaluating services for a new workload. The correct answer here reflects best practice for the specific scenario described — not a general cloud recommendation. Sensitivity labels classify and protect data across Microsoft 365 services. Cloud exam questions reward reading the constraint carefully: the same technology can be right or wrong depending on the use case.
What to study next
Got this wrong? Here's your next step.
Review sensitivity labels classify and protect data across Microsoft 365 services., then practise related MS-102 questions on the same topic to reinforce the concept.
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Manage compliance by using Microsoft Purview — study guide chapter
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FAQ
Questions learners often ask
What does this MS-102 question test?
Manage compliance by using Microsoft Purview — This question tests Manage compliance by using Microsoft Purview — Sensitivity labels classify and protect data across Microsoft 365 services..
What is the correct answer to this question?
The correct answer is: Sensitivity label — Sensitivity labels define the classification and protection settings (e.g., 'Confidential' marking and encryption). Auto-labeling policies automatically apply those labels to documents containing sensitive information types, such as credit card numbers, without requiring user intervention. Together, they enable automatic labeling based on sensitive content in SharePoint Online.
What should I do if I get this MS-102 question wrong?
Review sensitivity labels classify and protect data across Microsoft 365 services., then practise related MS-102 questions on the same topic to reinforce the concept.
What is the key concept behind this question?
Sensitivity labels classify and protect data across Microsoft 365 services.
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Last reviewed: Jun 11, 2026
This MS-102 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 MS-102 exam.
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