- A
Data Lifecycle Management to retain for 7 years then delete, and eDiscovery (Premium) to place a legal hold on the project documents
This combination correctly applies a retention-delete policy for financial records and uses legal hold to preserve the specific project documents during litigation.
- B
Data Lifecycle Management to retain for 7 years then delete, and Sensitivity labels to mark documents
Why wrong: Sensitivity labels are used for classification and protection (e.g., encryption), not for preservation. They cannot override a deletion policy.
- C
Audit (Premium) to log access and eDiscovery (Premium) to search
Why wrong: Audit logging and eDiscovery search help find and review data, but they do not preserve data from being deleted. A legal hold is required for preservation.
- D
Information Protection to classify data and Data Lifecycle Management to retain
Why wrong: Information Protection (sensitivity labels) adds classification but does not handle legal hold. Without a legal hold, the retention policy may delete documents needed for litigation.
Quick Answer
The correct combination is Data Lifecycle Management for the 7-year retention and deletion, paired with eDiscovery (Premium) to place a legal hold on the project documents. Data Lifecycle Management enforces regulatory compliance by automatically deleting financial records after seven years, while eDiscovery (Premium) overrides that deletion policy for documents under active litigation, ensuring they are preserved indefinitely. On the SC-900 exam, this scenario tests your understanding of how retention and legal hold interact within Microsoft Purview—a common trap is thinking a single feature can do both, but the key is that legal hold always supersedes deletion rules. Remember the memory tip: “Retain and remove with DLM, but hold for court with eDiscovery.”
SC-900 Practice Question: Describe the capabilities of Microsoft compliance solutions
This SC-900 practice question tests your understanding of describe the capabilities of microsoft compliance solutions. Match the stated requirement to the specific cloud service, access model, or configuration option — many options are valid in isolation but not for this scenario. 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 multinational corporation must comply with regulations that require them to keep financial records for 7 years and then permanently delete them. However, they are currently involved in litigation that requires preservation of all documents related to a specific project. They use Microsoft Purview. Which combination of features should they use to meet both requirements?
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
Data Lifecycle Management to retain for 7 years then delete, and eDiscovery (Premium) to place a legal hold on the project documents
Option A is correct because Data Lifecycle Management (DLM) allows you to create retention labels that enforce a 7-year retention period followed by automatic deletion, satisfying the regulatory requirement. eDiscovery (Premium) provides the ability to place a legal hold on specific documents, which overrides the deletion policy to preserve data relevant to ongoing litigation. This combination ensures both compliance with the retention/deletion mandate and the preservation obligation.
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.
- ✓
Data Lifecycle Management to retain for 7 years then delete, and eDiscovery (Premium) to place a legal hold on the project documents
Why this is correct
This combination correctly applies a retention-delete policy for financial records and uses legal hold to preserve the specific project documents during litigation.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Data Lifecycle Management to retain for 7 years then delete, and Sensitivity labels to mark documents
Why it's wrong here
Sensitivity labels are used for classification and protection (e.g., encryption), not for preservation. They cannot override a deletion policy.
- ✗
Audit (Premium) to log access and eDiscovery (Premium) to search
Why it's wrong here
Audit logging and eDiscovery search help find and review data, but they do not preserve data from being deleted. A legal hold is required for preservation.
- ✗
Information Protection to classify data and Data Lifecycle Management to retain
Why it's wrong here
Information Protection (sensitivity labels) adds classification but does not handle legal hold. Without a legal hold, the retention policy may delete documents needed for litigation.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse Sensitivity labels (which mark or protect data) with retention labels (which enforce lifecycle policies), or assume eDiscovery alone can handle both retention and hold, missing the need for DLM to define the deletion schedule.
Detailed technical explanation
How to think about this question
Data Lifecycle Management in Microsoft Purview uses retention labels that can be auto-applied based on sensitive information types or machine learning classifiers, and these labels can trigger a disposition review before permanent deletion. eDiscovery (Premium) legal hold uses a hold policy that applies a preservation lock, preventing any deletion or modification of content in Exchange Online, SharePoint Online, OneDrive for Business, and Teams, even if a DLM retention label would otherwise delete the data. In a real-world scenario, if litigation arises mid-retention period, the legal hold must be applied before the DLM deletion action triggers to avoid data loss.
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
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FAQ
Questions learners often ask
What does this SC-900 question test?
Describe the capabilities of Microsoft compliance solutions — This question tests Describe the capabilities of Microsoft compliance solutions — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Data Lifecycle Management to retain for 7 years then delete, and eDiscovery (Premium) to place a legal hold on the project documents — Option A is correct because Data Lifecycle Management (DLM) allows you to create retention labels that enforce a 7-year retention period followed by automatic deletion, satisfying the regulatory requirement. eDiscovery (Premium) provides the ability to place a legal hold on specific documents, which overrides the deletion policy to preserve data relevant to ongoing litigation. This combination ensures both compliance with the retention/deletion mandate and the preservation obligation.
What should I do if I get this SC-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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Last reviewed: Jun 11, 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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