MS-900 Describe Microsoft 365 apps and services Practice Question
A small business with 10 employees wants to use professional email with custom domain, web versions of Office apps, and 1 TB of cloud storage per user. Which Microsoft 365 plan meets these requirements?
⚠ Common exam trap
Test-takers frequently confuse Business Basic with Business Standard, assuming desktop Office apps are required for professional email, when Business Basic fully meets the stated needs with web-only Office apps and custom domain email.
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
✓
Microsoft 365 Business Basic
Microsoft 365 Business Basic provides professional email with a custom domain (Exchange Online), web versions of Office apps (Office for the web), and 1 TB of cloud storage per user (OneDrive for Business). This plan is designed for small businesses needing core productivity and communication tools at a lower cost, without desktop Office installations.
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 Apps for Business
Why it's wrong here
Microsoft 365 Apps for Business is incorrect because it licenses only the Office desktop applications (Word, Excel, PowerPoint, and Outlook) without an Exchange Online mailbox. Employees would have no hosted professional email at a custom domain, and the plan lacks SharePoint and Teams as part of a full collaboration stack. Since the stated need is professional communication, omitting Exchange Online is disqualifying.
- ✗
Microsoft 365 E3
Why it's wrong here
Microsoft 365 E3 is inappropriate for a 10-employee small business because it is an enterprise-grade plan designed for large organizations that require advanced compliance, security, and endpoint management capabilities. E3 includes email and desktop apps, but its higher per-user cost, annual commitment requirements, and administrative complexity are far more than needed. Business Basic provides the required functionality at a much lower SMB-oriented price point.
- ✗
Microsoft 365 Business Standard
Why it's wrong here
Microsoft 365 Business Standard includes Exchange Online, Teams, SharePoint, and desktop versions of Office applications, but it is not the best fit when the stated needs are already met by Business Basic. The extra cost per user goes mainly toward installed desktop apps and additional features that the small business did not request. Because Business Basic supplies the required email and web-based productivity tools, choosing Standard would overspend without a functional benefit in this scenario.
- ✓
Microsoft 365 Business Basic
Why this is correct
Microsoft 365 Business Basic is the correct choice because it includes Exchange Online for professional email on a custom domain, Microsoft Teams, SharePoint, and web-based Office apps, plus 1 TB of OneDrive storage per user. This plan meets the small business's stated need for professional communication and collaboration at a lower per-user price than plans with desktop applications. The absence of desktop Office apps is acceptable because the situation calls for cloud-based productivity rather than locally installed software.
Go deeper
Related to this question
Learn chapter
Securing Microsoft 365 Apps: OAuth and App Consent
Key term
Cloud storage
Cloud storage is a service that lets you save data on remote servers accessed over the internet instead of on your computer's hard drive.
Key term
Microsoft 365
Microsoft 365 is a subscription-based cloud service from Microsoft that combines productivity tools like Office apps with security, device management, and online storage.
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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.