This SC-900 practice question tests your understanding of describe the capabilities of microsoft entra. 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 company wants to allow employees to sign in using their Microsoft credentials (e.g., personal Outlook.com) to access internal applications. Which Microsoft Entra feature should be configured?
Microsoft Entra B2B collaboration
Why wrong: B2B is for business partners, not personal accounts.
Microsoft Entra device enrollment
Why wrong: Device enrollment manages devices, not identities.
Microsoft Entra hybrid identity
Why wrong: Hybrid identity syncs on-prem AD.
Microsoft Entra External ID
External ID supports consumer identities like Microsoft accounts.
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 Entra External ID
Microsoft Entra External ID (formerly Azure AD External Identities) allows organizations to enable external users—including consumers with personal Microsoft accounts (e.g., Outlook.com)—to sign in to internal applications using their own credentials. This feature supports identity providers like Microsoft Accounts (MSA), Google, Facebook, and SAML/WS-Fed IdPs, making it the correct choice for allowing employees to use personal Outlook.com credentials for access.
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 Entra B2B collaboration
Why it's wrong here
B2B is for business partners, not personal accounts.
Microsoft Entra device enrollment
Why it's wrong here
Device enrollment manages devices, not identities.
Microsoft Entra hybrid identity
Why it's wrong here
Hybrid identity syncs on-prem AD.
Microsoft Entra External ID
Why this is correct
External ID supports consumer identities like Microsoft accounts.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
The trap here is confusing Microsoft Entra B2B collaboration (which requires a business or school account) with Microsoft Entra External ID (which supports personal Microsoft accounts and social identities), leading candidates to incorrectly select B2B for consumer-facing scenarios.
Detailed technical explanation
Microsoft Entra External ID leverages the Microsoft Authentication Library (MSAL) and OAuth 2.0/OpenID Connect protocols to authenticate external users via their personal Microsoft accounts. Under the hood, the tenant is configured with an external identity provider (IdP) that issues tokens after validating the user's credentials against Microsoft's consumer identity system (MSA). In a real-world scenario, a company might use External ID to allow contractors or customers to access a partner portal with their personal Outlook.com email, while still enforcing conditional access policies like multi-factor authentication (MFA) for those external identities.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
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
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FAQ
Describe the capabilities of Microsoft Entra — This question tests Describe the capabilities of Microsoft Entra — Read the scenario before looking for a memorised answer..
The correct answer is: Microsoft Entra External ID — Microsoft Entra External ID (formerly Azure AD External Identities) allows organizations to enable external users—including consumers with personal Microsoft accounts (e.g., Outlook.com)—to sign in to internal applications using their own credentials. This feature supports identity providers like Microsoft Accounts (MSA), Google, Facebook, and SAML/WS-Fed IdPs, making it the correct choice for allowing employees to use personal Outlook.com credentials for access.
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
This SC-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 SC-900 exam.
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