ITIL4-CDS Create, Deliver and Support Practice Question
When an organization uses 'Service Level Objectives' (SLOs), what is the main purpose of defining an 'Error Budget'?
⚠ Common exam trap
Test-takers frequently assume an error budget is used as a penalty tool for development teams when it is actually designed to balance innovation speed with service reliability.
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
✓
To balance the need for innovation with the need for reliability.
An error budget defines the maximum amount of downtime or performance degradation a service can experience within a period while still meeting the agreed-upon Service Level Objective. This is a critical balancing tool in CDS, as it allows organizations to innovate and deploy changes while keeping service reliability within acceptable limits, ensuring the provider manages risk and user expectations effectively.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
To strictly prevent any service failures from occurring.
Why it's wrong here
Error budgets recognize that zero failures is unrealistic. They provide a quantitative allowance for issues, acknowledging that some risk is acceptable in exchange for faster development and innovation. The goal is not to eliminate all failures, but to manage them so they stay within the agreed-upon target reliability.
- ✓
To balance the need for innovation with the need for reliability.
Why this is correct
Error budgets allow for a controlled amount of failure. If the budget is not depleted, teams can take more risks with new features. If the budget is low, teams must prioritize stability. This balances the competing needs for service reliability and the fast-paced delivery of new value to users.
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To determine the budget for buying new hardware.
Why it's wrong here
The term 'error budget' is entirely related to service reliability, not financial budgets for infrastructure procurement. Financial budgeting is a separate process involving capital and operational expenditure planning, which is unrelated to the technical reliability metrics defined in an error budget for service level objectives.
- ✗
To set the salary bonuses for the development team.
Why it's wrong here
Error budgets are for managing service quality and risk, not for human resources performance incentives. Using them for bonuses can lead to perverse incentives, where teams might hide issues to protect their bonuses rather than focusing on the transparency and reliability goals of the service management practice.
About these practice questions
This ITIL4-CDS question is part of Courseiva's 155-question bank — original exam-style content with full explanations and wrong-answer analysis, never real exam questions or exam dumps. Learn why practice questions differ from exam dumps →
JA
Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official PeopleCert/AXELOS exam blueprint
This ITIL4-CDS practice question is part of Courseiva's free PeopleCert/AXELOS 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 ITIL4-CDS exam.