mediumMultiple ChoiceObjective-mapped
MS-900 Practice Question: A company with 300 Microsoft 365 E3 users needs…
A company with 300 Microsoft 365 E3 users needs to add advanced identity protection features: Microsoft Entra ID Premium P2 and Microsoft Defender for Identity. They want to add these capabilities without upgrading all users to E5. What is the most cost-effective licensing strategy?
⚠ Common exam trap
It's easy for candidates to confuse the Enterprise Mobility + Security E5 add-on with the E5 Security add-on, not realizing that EMS E5 lacks Microsoft Defender for Identity and is therefore insufficient for the stated requirements.
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
✓
Add the Microsoft 365 E5 Security add-on for each user.
The Microsoft 365 E5 Security add-on bundles Microsoft Entra ID Premium P2 and Microsoft Defender for Identity (along with other security features) at a lower per-user cost than purchasing them separately, and it can be added to an existing E3 subscription without upgrading the entire license. This provides the required identity protection capabilities cost-effectively for all 300 users.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Upgrade all users to Microsoft 365 E5.
Why it's wrong here
Upgrading all users to Microsoft 365 E5 would indeed deliver the missing advanced security features, but it also forces the purchase of non-security capabilities such as Power BI Pro, advanced compliance, and audio conferencing. For 300 users, the incremental cost per user is substantially higher than adding the E5 Security add-on to their existing E3 licenses. Since the requirement is narrowly about advanced security, the targeted add-on provides the needed functionality without paying for unrelated services.
- ✗
Add Microsoft Entra ID Premium P2 and Microsoft Defender for Identity as standalone add-ons.
Why it's wrong here
While you can purchase Microsoft Entra ID Premium P2 and Microsoft Defender for Identity separately, doing so is rarely the most cost-effective path. Each standalone SKU carries its own per-user price, and the combined cost usually exceeds that of the Microsoft 365 E5 Security add-on, which bundles these two with additional threat protection products. Moreover, managing multiple separate security license SKUs adds administrative complexity and can lead to feature gaps if other Defender workloads are needed later.
- ✓
Add the Microsoft 365 E5 Security add-on for each user.
Why this is correct
The Microsoft 365 E5 Security add-on is the correct choice because it attaches the necessary proprietary workloads to E3 without a full E5 upgrade. This per-user add-on bundles Microsoft Entra ID Premium P2, Microsoft Defender for Identity, Defender for Office 365, Defender for Endpoint, and other advanced security tools explicitly designed to close the security gap. It provides the advanced protection the company requires while remaining more economical than upgrading to E5 or assembling separate add-ons.
- ✗
Add Enterprise Mobility + Security E5 add-on.
Why it's wrong here
Enterprise Mobility + Security E5 would bring Microsoft Entra ID Premium P2 and Microsoft Intune, but it notably lacks Microsoft Defender for Identity, so it would not fully satisfy the requested advanced security capabilities. The Microsoft 365 E5 Security add-on is the intended additive bundle for E3 users who need complete security coverage, including identity threat detection. Choosing EM+S E5 would still leave the organization without critical identity protection that Defender for Identity provides.
Go deeper
Related to this question
Learn chapter
Benefits of Microsoft Cloud
Key term
User
A user is any person, system, or device that interacts with an IT service, resource, or identity system, typically authenticated through credentials and authorized to perform specific actions.
Key term
Subscription
A subscription is a payment model where you pay a recurring fee to access a product or service instead of buying it once and owning it forever.
About these practice questions
One of 217 original MS-900 practice questions on Courseiva, each with a full explanation and wrong-answer analysis — not exam dumps or protected exam content. Learn why practice questions differ from exam dumps →
JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This MS-900 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-900 exam.