This EX294 practice question tests your understanding of manage inventories and credentials. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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 Ansible playbook uses the `ansible_password` variable to connect to a Windows host. The value is stored in an encrypted Ansible Vault file. Which credential type in Automation Controller would allow the vault password to be supplied at runtime?
Cloud credential
Why wrong: Cloud credentials are for cloud provider access.
Machine credential
Why wrong: Machine credentials are for SSH/WinRM authentication, not vault passwords.
Vault credential
Vault credentials provide the vault password to decrypt vault-encrypted files.
Network credential
Why wrong: Network credentials are for network devices.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
Vault credential
Option C is correct because Automation Controller's Vault credential type is specifically designed to provide the vault password needed to decrypt Ansible Vault-encrypted variables like `ansible_password`. When a job runs, the controller uses this credential to unlock the vault file, allowing the playbook to access the encrypted value at runtime without exposing the plaintext password.
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.
Cloud credential
Why it's wrong here
Cloud credentials are for cloud provider access.
Machine credential
Why it's wrong here
Machine credentials are for SSH/WinRM authentication, not vault passwords.
Vault credential
Why this is correct
Vault credentials provide the vault password to decrypt vault-encrypted files.
Related concept
Read the scenario before looking for a memorised answer.
Network credential
Why it's wrong here
Network credentials are for network devices.
Common exam traps
The trap here is that candidates confuse the credential type used to authenticate to the target host (Machine credential) with the credential type needed to decrypt the vault file containing the host's password, leading them to select Option B instead of C.
Detailed technical explanation
Under the hood, Automation Controller stores the vault password securely and passes it to the `ansible-vault` command via the `--vault-password-file` option or the `ANSIBLE_VAULT_PASSWORD_FILE` environment variable when executing the playbook. This allows the playbook to decrypt vault-encrypted variables like `ansible_password` at runtime without the plaintext password ever being visible in logs or job output. In real-world scenarios, teams often combine a Machine credential for host access with a Vault credential to securely manage sensitive variables across inventories.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
A practitioner preparing for the EX294 exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
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FAQ
Manage inventories and credentials — This question tests Manage inventories and credentials — Read the scenario before looking for a memorised answer..
The correct answer is: Vault credential — Option C is correct because Automation Controller's Vault credential type is specifically designed to provide the vault password needed to decrypt Ansible Vault-encrypted variables like `ansible_password`. When a job runs, the controller uses this credential to unlock the vault file, allowing the playbook to access the encrypted value at runtime without exposing the plaintext password.
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 11, 2026
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