Question 612 of 985

Describe security, compliance, privacy, and trust in Microsoft 365 →hardMultiple ChoiceObjective-mapped

Auto-Labeling with Sensitivity Labels for Automatic Encryption and Restriction

This MS-900 practice question tests your understanding of describe security, compliance, privacy, and trust in microsoft 365. 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 compliance administrator needs to ensure that any document containing a patient's health information (e.g., medical record number) is automatically encrypted and restricted to authorized users. The encryption should be enforced regardless of where the document is saved (SharePoint, OneDrive, or email). Which Microsoft Purview feature should they configure?

A
Information Rights Management (IRM)
Why wrong: IRM can protect documents by restricting actions, but it does not automatically classify or label content based on sensitive data detection.
B
Auto-labeling policies with sensitivity labels
Auto-labeling can automatically detect sensitive data (like health info) and apply a sensitivity label that enforces encryption and access restrictions.
C
Data Loss Prevention (DLP) policies
Why wrong: DLP detects and prevents sharing of sensitive data but does not automatically encrypt documents at rest.
D
Retention labels
Why wrong: Retention labels are used to keep or delete content for compliance and do not apply encryption or restrictions.

Full breakdown with real-world context →

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

✓

Auto-labeling policies with sensitivity labels

Auto-labeling policies with sensitivity labels are the correct choice because they can automatically apply encryption and access restrictions to documents containing sensitive data like medical record numbers, regardless of where the document is saved (SharePoint, OneDrive, or email). Sensitivity labels support persistent protection that travels with the file, enforcing encryption and authorized user restrictions even when the file is moved or copied. This meets the requirement for automatic, location-independent encryption and access control.

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.

✗
Information Rights Management (IRM)
Why it's wrong here
IRM can protect documents by restricting actions, but it does not automatically classify or label content based on sensitive data detection.
✓
Auto-labeling policies with sensitivity labels
Why this is correct
Auto-labeling can automatically detect sensitive data (like health info) and apply a sensitivity label that enforces encryption and access restrictions.
Related concept
Read the scenario before looking for a memorised answer.
✗
Data Loss Prevention (DLP) policies
Why it's wrong here
DLP detects and prevents sharing of sensitive data but does not automatically encrypt documents at rest.
✗
Retention labels
Why it's wrong here
Retention labels are used to keep or delete content for compliance and do not apply encryption or restrictions.

Common exam traps

Common exam trap: answer the scenario, not the keyword

The trap here is that candidates often confuse DLP policies with sensitivity labels, thinking DLP can enforce encryption, but DLP only monitors and blocks actions—it does not apply persistent protection like sensitivity labels do.

Detailed technical explanation

How to think about this question

Sensitivity labels use Azure Information Protection (AIP) to apply encryption via Azure Rights Management (Azure RMS), which uses the AD RMS cryptographic protocol to enforce persistent protection. The auto-labeling policy can be configured with a condition that detects a sensitive info type (e.g., U.S. Medical Record Number) and automatically applies a label that encrypts the document and restricts access to authorized users, even if the file is saved to a different location or shared via email. A real-world scenario is a healthcare organization that needs to ensure patient records remain encrypted and accessible only to specific roles, regardless of whether the file is stored in SharePoint, OneDrive, or attached to an email.

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 company's IT admin needs to give a contractor read-only access to production logs without sharing account credentials. Using role-based access control (RBAC) and temporary scoped permissions — not a permanent shared password — is the correct pattern. Questions like this test whether you can apply least-privilege access across cloud identity services.

What to study next

Got this wrong? Here's your next step.

Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.

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FAQ

Questions learners often ask

What does this MS-900 question test?

Describe security, compliance, privacy, and trust in Microsoft 365 — This question tests Describe security, compliance, privacy, and trust in Microsoft 365 — Read the scenario before looking for a memorised answer..

What is the correct answer to this question?

The correct answer is: Auto-labeling policies with sensitivity labels — Auto-labeling policies with sensitivity labels are the correct choice because they can automatically apply encryption and access restrictions to documents containing sensitive data like medical record numbers, regardless of where the document is saved (SharePoint, OneDrive, or email). Sensitivity labels support persistent protection that travels with the file, enforcing encryption and authorized user restrictions even when the file is moved or copied. This meets the requirement for automatic, location-independent encryption and access control.

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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Same concept, more angles

1 more ways this is tested on MS-900

These questions test the same concept from different angles. Work through them to make sure you can recognise it however the exam phrases it.

Variation 1. You are the security administrator for Contoso, a global consulting firm with 10,000 employees. Contoso uses Microsoft 365 E5 and Microsoft Entra ID P2. The company has a strict policy that all sensitive client data must be encrypted at rest and in transit. Additionally, the legal team requires that any document labeled as 'Highly Confidential' must be automatically encrypted and cannot be printed or forwarded. You have created a sensitivity label called 'Highly Confidential' with encryption and a protection setting that restricts actions like printing. However, you notice that users are still able to print documents that have the label applied. After investigation, you find that the label is correctly configured but users are manually applying the label. What should you do to ensure the label is consistently applied and printing is blocked?

hard

A.Create a Data Loss Prevention (DLP) policy that blocks printing of documents with the 'Highly Confidential' label.
B.Configure a Conditional Access policy that blocks printing for users accessing documents from unmanaged devices.
C.Modify the sensitivity label's encryption settings to require user authentication before printing.
✓ D.Create an auto-labeling policy that automatically applies the 'Highly Confidential' label to documents that contain certain sensitive information types, and ensure the label's protection settings block printing.

Why D: Option D is correct because auto-labeling policies automatically apply the 'Highly Confidential' label to documents containing specified sensitive information types, ensuring consistent labeling. Once applied, the label's built-in protection settings block printing. Option A is incorrect because DLP policies can block printing but do not apply sensitivity labels. Option B is incorrect because Conditional Access controls access to resources, not document-level actions like printing. Option C is incorrect because the label already has encryption; the issue is manual application, not encryption settings.

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