MS-900 Practice Question: Describe Microsoft 365 pricing, licensing, and support
This MS-900 practice question tests your understanding of describe microsoft 365 pricing, licensing, and support. 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.
A company is choosing a Microsoft 365 plan for 150 users who need email, file storage, and Teams. They also need basic compliance features such as data retention policies and eDiscovery. Which TWO plans meet these requirements?
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Microsoft 365 E3
Microsoft 365 E3 includes Exchange Online, SharePoint Online, and Teams, plus advanced compliance features like data retention policies and eDiscovery (Standard). Microsoft 365 Business Premium also includes these core services and compliance capabilities, making both suitable for 150 users needing email, file storage, Teams, and basic compliance.
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.
✗
Microsoft 365 E1
Why it's wrong here
E1 lacks eDiscovery and retention policies.
✓
Microsoft 365 E3
Why this is correct
E3 includes all required features and is suitable for any size.
Related concept
Read the scenario before looking for a memorised answer.
✓
Microsoft 365 Business Premium
Why this is correct
Business Premium includes all required features for up to 300 users.
Related concept
Read the scenario before looking for a memorised answer.
✗
Microsoft 365 E5
Why it's wrong here
E5 includes all features but is more expensive than needed.
✗
Microsoft 365 Business Basic
Why it's wrong here
Business Basic does not include eDiscovery and retention policies.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often assume only E3 or E5 can provide compliance features, forgetting that Microsoft 365 Business Premium also includes data retention policies and eDiscovery (Standard) for organizations under 300 users.
Detailed technical explanation
How to think about this question
Data retention policies in Microsoft 365 rely on the Compliance Center's retention policies, which use preservation locks and adaptive scopes to enforce retention at the workload level (Exchange, SharePoint, OneDrive, Teams). eDiscovery (Standard) uses content searches and holds via the eDiscovery Center, leveraging searchable indexes across Exchange, SharePoint, and Teams chat data. For 150 users, Business Premium supports up to 300 users and includes these compliance features, while E3 scales to unlimited users with the same core compliance capabilities.
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.
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
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 MS-900 question in full detail.
Describe Microsoft 365 pricing, licensing, and support — This question tests Describe Microsoft 365 pricing, licensing, and support — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Microsoft 365 E3 — Microsoft 365 E3 includes Exchange Online, SharePoint Online, and Teams, plus advanced compliance features like data retention policies and eDiscovery (Standard). Microsoft 365 Business Premium also includes these core services and compliance capabilities, making both suitable for 150 users needing email, file storage, Teams, and basic compliance.
What should I do if I get this MS-900 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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Question Discussion
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