This SC-900 practice question tests your understanding of describe the capabilities of microsoft entra. 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.
An organization uses Microsoft Entra ID for identity management and wants to allow external partners to access their resources using their own corporate credentials. Which feature should they enable?
Entra External ID
Entra External ID enables B2B collaboration with external identities.
Identity Protection
Why wrong: Identity Protection is for detecting risky sign-ins, not for external collaboration.
Conditional Access
Why wrong: Conditional Access enforces policies but doesn't create external identities.
Privileged Identity Management
Why wrong: PIM manages privileged roles, not external user access.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Entra External ID
Entra External ID (formerly Azure AD B2B) enables organizations to invite external partners to access resources using their own corporate credentials. This feature leverages federation protocols such as SAML, WS-Fed, or OpenID Connect to authenticate the partner's identity in their home tenant, eliminating the need for separate local accounts.
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.
Entra External ID
Why this is correct
Entra External ID enables B2B collaboration with external identities.
Related concept
Read the scenario before looking for a memorised answer.
Identity Protection
Why it's wrong here
Identity Protection is for detecting risky sign-ins, not for external collaboration.
Conditional Access
Why it's wrong here
Conditional Access enforces policies but doesn't create external identities.
Privileged Identity Management
Why it's wrong here
PIM manages privileged roles, not external user access.
Common exam traps
The trap here is that candidates often confuse Conditional Access (a policy engine) with the ability to invite external identities, mistakenly thinking policies alone can grant external access without a federation mechanism.
Detailed technical explanation
Under the hood, Entra External ID uses cross-tenant trust relationships where the partner's home tenant issues a token that Entra ID validates via the SAML or OIDC protocol. A subtle behavior is that if the partner's tenant uses a different IdP (e.g., Google or Facebook), Entra External ID can still federate via email one-time passcode as a fallback. In a real-world scenario, a company can invite a vendor's IT team to access a SharePoint site, and the vendor's users authenticate against their own Entra ID tenant without ever needing a guest username/password in the host tenant.
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: Entra External ID — Entra External ID (formerly Azure AD B2B) enables organizations to invite external partners to access resources using their own corporate credentials. This feature leverages federation protocols such as SAML, WS-Fed, or OpenID Connect to authenticate the partner's identity in their home tenant, eliminating the need for separate local accounts.
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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