This MS-900 practice question tests your understanding of describe microsoft 365 apps and services. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. 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 user needs to collaborate on a document with colleagues in real time, but the document must be stored on a local network server due to regulatory requirements. Which Microsoft 365 app should the user use?
Microsoft SharePoint
Why wrong: Stores documents in the cloud, not on a local network server.
Microsoft Word (desktop)
Why wrong: Saves locally but does not support real-time collaboration.
Microsoft OneDrive
Syncs files to the cloud, enabling collaboration while maintaining a local copy.
Microsoft Teams
Why wrong: Uses SharePoint for file storage, same cloud limitation.
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 OneDrive
Option C is correct because Microsoft OneDrive supports real-time co-authoring via its sync client and web interface, but crucially, when used with 'Files On-Demand' and local sync, the actual file can be stored on a local network server if the user syncs a SharePoint document library that resides on-premises via a cloud hybrid configuration. However, the question specifies the document must be stored on a local network server due to regulatory requirements; OneDrive for Business can sync files from a local server if the organization uses a cloud hybrid setup with SharePoint Server, but the core scenario is that OneDrive allows offline access and real-time collaboration while the authoritative copy remains on-premises. This meets the regulatory need for local storage while enabling real-time co-authoring.
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 SharePoint
Why it's wrong here
Stores documents in the cloud, not on a local network server.
Microsoft Word (desktop)
Why it's wrong here
Saves locally but does not support real-time collaboration.
Microsoft OneDrive
Why this is correct
Syncs files to the cloud, enabling collaboration while maintaining a local copy.
Related concept
Read the scenario before looking for a memorised answer.
Microsoft Teams
Why it's wrong here
Uses SharePoint for file storage, same cloud limitation.
Common exam traps
The trap here is that candidates assume OneDrive is exclusively a cloud-only service, but Microsoft 365 allows hybrid configurations where OneDrive syncs with on-premises SharePoint Server, enabling local storage while still providing real-time co-authoring capabilities.
Detailed technical explanation
OneDrive for Business uses the Sync Engine (File Sync Protocol) to synchronize files between a local folder and SharePoint/OneDrive, but it can also sync files from a SharePoint Server on-premises if the organization uses a hybrid deployment with the SharePoint Server 2013 or later and the OneDrive sync app. Real-time co-authoring relies on the Office Collaboration Service, which uses WebSocket connections and the Co-Authoring Protocol (MS-COAUTH) to merge changes at the paragraph level; this works even when the file is synced locally, as long as the sync client maintains a connection to the server. In a regulatory scenario, an organization could deploy a SharePoint farm on-premises, enable hybrid sync with OneDrive, and allow users to co-author documents that physically reside on the local network server, satisfying compliance requirements.
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
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FAQ
Describe Microsoft 365 apps and services — This question tests Describe Microsoft 365 apps and services — Read the scenario before looking for a memorised answer..
The correct answer is: Microsoft OneDrive — Option C is correct because Microsoft OneDrive supports real-time co-authoring via its sync client and web interface, but crucially, when used with 'Files On-Demand' and local sync, the actual file can be stored on a local network server if the user syncs a SharePoint document library that resides on-premises via a cloud hybrid configuration. However, the question specifies the document must be stored on a local network server due to regulatory requirements; OneDrive for Business can sync files from a local server if the organization uses a cloud hybrid setup with SharePoint Server, but the core scenario is that OneDrive allows offline access and real-time collaboration while the authoritative copy remains on-premises. This meets the regulatory need for local storage while enabling real-time co-authoring.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 24, 2026
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