Quick Answer
The answer is Microsoft 365 Business Basic, because Microsoft Entra ID Free already includes self-service password reset (SSPR) for cloud-only users. The key technical concept here is that SSPR for cloud identities is a free feature of the Entra ID Free tier, so any subscription that includes Entra ID Free—such as Microsoft 365 Business Basic—meets the minimum licensing requirement. On the MS-102 exam, this question tests your ability to distinguish between cloud-only and hybrid scenarios; a common trap is assuming paid P1 or P2 licenses are needed when the question doesn’t mention on-premises writeback or hybrid identity. Remember, if the scenario says nothing about on-premises users, the free tier covers SSPR for cloud accounts. Memory tip: “Cloud-only is free, hybrid needs a fee.”
This MS-102 practice question tests your understanding of implement and manage microsoft entra identity and access. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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.
Your organization uses Microsoft Entra ID and wants to allow users to reset their own passwords using self-service password reset (SSPR). What is the minimum licensing required?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue: "minimum / minimize"
Why it matters: Asks for the least resource use — fewest addresses, smallest subnet, lowest overhead. Eliminate over-provisioned options even if they would technically work.
Microsoft Entra ID P2
Why wrong: P2 is not required for SSPR.
Microsoft 365 Business Basic
Any paid Microsoft 365 license includes Azure AD Free which provides SSPR for cloud users.
Microsoft Entra ID Free
Why wrong: Free includes SSPR for cloud users, but requires a paid Microsoft 365 license to be used.
Microsoft Entra ID P1
Why wrong: P1 is not the minimum; Free provides SSPR for cloud users.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Microsoft 365 Business Basic
Microsoft Entra ID Free includes self-service password reset (SSPR) for cloud-only users. Since the question does not specify hybrid or on-premises requirements, the minimum licensing needed is the free tier. Microsoft 365 Business Basic includes Entra ID Free, making it a valid minimum licensing option that provides SSPR for cloud users.
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.
Microsoft Entra ID P2
Why it's wrong here
P2 is not required for SSPR.
Microsoft 365 Business Basic
Why this is correct
Any paid Microsoft 365 license includes Azure AD Free which provides SSPR for cloud users.
Clue confirmation
The clue word "minimum / minimize" in the question point toward this answer.
Related concept
Read the scenario before looking for a memorised answer.
Microsoft Entra ID Free
Why it's wrong here
Free includes SSPR for cloud users, but requires a paid Microsoft 365 license to be used.
Microsoft Entra ID P1
Why it's wrong here
P1 is not the minimum; Free provides SSPR for cloud users.
Common exam traps
The trap here is that candidates assume SSPR always requires a premium license (P1 or P2) because they think of hybrid scenarios or advanced features, but the free tier fully supports SSPR for cloud-only users.
Detailed technical explanation
SSPR in Microsoft Entra ID Free relies on the built-in authentication methods (email, mobile phone, security questions) and works only for cloud-native users. For hybrid users synced from on-premises Active Directory, SSPR requires Microsoft Entra ID P1 or P2 to enable password writeback, which writes the new password back to on-premises AD. The question does not mention hybrid or writeback, so the free tier is sufficient.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
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.
What to study next
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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FAQ
Implement and manage Microsoft Entra identity and access — This question tests Implement and manage Microsoft Entra identity and access — Read the scenario before looking for a memorised answer..
The correct answer is: Microsoft 365 Business Basic — Microsoft Entra ID Free includes self-service password reset (SSPR) for cloud-only users. Since the question does not specify hybrid or on-premises requirements, the minimum licensing needed is the free tier. Microsoft 365 Business Basic includes Entra ID Free, making it a valid minimum licensing option that provides SSPR for cloud users.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Yes — watch for: "minimum / minimize". Asks for the least resource use — fewest addresses, smallest subnet, lowest overhead. Eliminate over-provisioned options even if they would technically work.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 24, 2026
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