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MS-900 Practice Question: A small business with 10 users needs the fully…
A small business with 10 users needs the fully installed desktop versions of Office apps (Word, Excel, PowerPoint), business-class email, and 1 TB of cloud storage per user. They do not require advanced security or compliance features. Which Microsoft 365 plan is the most cost-effective choice?
⚠ Common exam trap
A common mix-up: candidates confuse 'Business Basic' (which has web-only apps) with 'Business Standard' (which includes desktop apps), or assume that 'E3' is always the best choice for any business due to its enterprise branding, overlooking the cost and feature overkill for small businesses without advanced security needs.
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 Standard
Microsoft 365 Business Standard is the most cost-effective plan for this small business because it includes the fully installed desktop versions of Office apps (Word, Excel, PowerPoint), business-class email (Exchange Online), and 1 TB of OneDrive cloud storage per user. It meets all stated requirements without the higher cost of E3 or the lack of desktop apps in Business Basic or Office 365 E1.
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 Business Basic
Why it's wrong here
Microsoft 365 Business Basic is a cloud-only plan that delivers Exchange Online, SharePoint, Teams, and OneDrive for Business, but its Office applications are limited to web and mobile editions. It does not include the locally installed Word, Excel, PowerPoint, or Outlook desktop clients, so it cannot satisfy the requirement for a fully installed desktop application. This plan is better suited for users who only need email and online collaboration through a browser.
- ✓
Microsoft 365 Business Standard
Why this is correct
Microsoft 365 Business Standard is the correct choice because it bundles the fully installed Microsoft 365 desktop apps (Word, Excel, PowerPoint, Outlook, and others) with Exchange Online email, SharePoint, Teams, and 1 TB of OneDrive storage per user. It is designed for small businesses with up to 300 users, providing all the stated needs at a per-user cost that is lower than enterprise-level plans like E3. This makes it the optimal balance of functionality and price for a 10-user organization.
- ✗
Microsoft 365 E3
Why it's wrong here
Microsoft 365 E3 includes the fully installed desktop Office apps along with advanced enterprise security and compliance tools such as Microsoft Defender for Office 365, data loss prevention, and eDiscovery. For a small business with only 10 users that simply needs desktop applications and email, these additional capabilities represent unnecessary licensing cost and administrative complexity. E3 is intended for larger enterprises with regulatory or high-security requirements, making it overprovisioned for this scenario.
- ✗
Office 365 E1
Why it's wrong here
Office 365 E1 is an enterprise-level plan that provides Exchange Online, SharePoint, and Teams, but it offers only web-based versions of the Office applications—never the full desktop clients. Because it lacks the locally installed Word, Excel, PowerPoint, and Outlook apps, it fails the explicit requirement for a fully installed desktop. It is a common misconception that E1 includes desktop Office; in fact, only plans like Business Standard, E3, or E5 include those, so E1 is an incorrect fit here.
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Cloud Service Types for MS-900
Key term
Office 365
Office 365 is a cloud-based subscription service from Microsoft that provides access to productivity applications like Word, Excel, and Outlook, along with other cloud services, for a monthly or annual fee.
Key term
Exchange Online
Exchange Online is Microsoft's cloud-based email, calendar, and contact hosting service that is part of the Microsoft 365 suite, allowing organizations to manage corporate messaging without maintaining their own mail servers.
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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.