Microsoft SC-401Administering Information Security in Microsoft 365 Exam Dumps and Practice Test Questions Set 14 Q196-210
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Question 196:
You want to prevent employees from sharing sensitive financial reports outside the organization while still collaborating internally. Which feature should you implement?
A) Data Loss Prevention
B) Sensitivity Labels
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Data Loss Prevention (DLP) in Microsoft 365 is designed to prevent accidental or unauthorized sharing of sensitive information, including financial reports. DLP policies identify sensitive content using predefined sensitive information types such as credit card numbers, banking details, payroll data, or tax information. Policies can be applied across Microsoft 365 workloads, including Exchange, Teams, OneDrive, and SharePoint, ensuring consistent protection.
When a user attempts to share restricted content externally, DLP can block the action, display a policy tip to educate the user about compliance requirements, or notify administrators for follow-up. This proactive enforcement helps organizations meet regulatory standards like SOX, GDPR, or PCI DSS, while still enabling internal collaboration. DLP reports provide insight into incidents, policy effectiveness, and patterns of potential risk, allowing administrators to adjust policies or provide additional training to employees. These insights are crucial because organizations often struggle with balancing user enablement against strict compliance demands. With DLP, administrators are not only able to detect violations but also understand why these events occur—whether due to user error, insufficient training, overly permissive access controls, or evolving business processes that require policy updates.
In addition to preventing external sharing, DLP protects against risky internal behaviors that could lead to accidental exposure. For example, DLP policies can detect when sensitive payroll data is copied to a noncompliant Teams channel, uploaded to a personal OneDrive folder, or shared with unauthorized internal groups. This ensures that sensitive information remains within the proper boundaries even inside the organization. DLP’s ability to scan documents at rest—within SharePoint or OneDrive—adds another layer of security, automatically identifying content that violates policies and guiding administrators to remediate risks before they escalate.
Furthermore, DLP integrates seamlessly with Microsoft Purview’s unified compliance portal, enabling centralized management of all policies across Exchange, SharePoint, Teams, OneDrive, and even endpoint devices. This consistency ensures that protection follows the content wherever it resides or travels. The centralized interface reduces administrative overhead, enhances policy consistency, and allows organizations to quickly deploy new templates for industry regulations or emerging threats. Audit logs, classification insights, and incident analytics help organizations continuously refine their compliance posture, making DLP not a static control but an adaptive, evolving protection framework.
Sensitivity Labels classify and protect content through encryption and access control, but do not actively block sharing. Their primary function is to secure content in a persistent manner so that only authorized users—in accordance with assigned permissions—can open or interact with the data. While Sensitivity Labels are powerful for ensuring confidentiality, they rely heavily on user selection unless combined with automated labeling policies. Even then, they are not intended to prevent sharing actions in real time. As a result, users may inadvertently share encrypted documents externally, causing confusion but not preventing exposure attempts at the behavioral level. Sensitivity Labels secure content but do not enforce actions.
Retention Labels preserve or delete content according to schedules, but they do not prevent external sharing. Retention policies are designed for data lifecycle management, supporting compliance for document preservation, regulatory retention obligations, or defensible deletion. Although essential for long-term governance, Retention Labels are not focused on preventing immediate data loss. An employee could share a document governed by a retention policy with an external recipient without any restriction from the label itself. Retention controls operate on time-based rules, not on sharing behaviors or content movement.
Conditional Access governs access based on identity, device, or location, but cannot analyze or restrict content sharing in real time. These policies ensure that only trusted users on compliant devices can access resources, effectively forming a perimeter around authentication and session initiation. However, once a user has access, Conditional Access has no visibility into what content is being shared or how sensitive it is. Therefore, while Conditional Access strengthens authentication scenarios, it does not protect the content itself. It focuses on controlling entrance to the environment, not what happens inside it.
DLP is the correct solution because it actively enforces sharing policies, educates users, monitors content activity, and integrates with reporting tools to maintain regulatory compliance. DLP’s strength lies in its ability to intervene at the moment of risk, whether through blocking, warning, or logging actions. This real-time enforcement is essential for organizations handling sensitive financial, HR, healthcare, or legal data. Unlike Sensitivity Labels, DLP is behavior-focused and prevents sharing rather than merely securing content. Unlike Retention Labels, it works in real time rather than applying lifecycle policies. Unlike Conditional Access, it protects the content itself rather than controlling access context.
Implementing DLP ensures sensitive financial data is secure while maintaining collaboration productivity. It not only protects against data leaks but also elevates the organization’s compliance maturity by delivering actionable insights, streamlined administrative workflows, and user-friendly education mechanisms. As regulatory expectations evolve and data volumes increase, DLP provides a scalable, adaptive, and integrated solution that safeguards sensitive content without hindering operational efficiency.
Question 197:
You need to preserve all emails and Teams messages for an ongoing audit and ensure they cannot be deleted. Which feature should you implement?
A) eDiscovery Legal Hold
B) Retention Labels
C) Data Loss Prevention
D) Communication Compliance
Answer: A
Explanation:
eDiscovery Legal Hold in Microsoft 365 enables organizations to preserve emails, Teams messages, SharePoint documents, and OneDrive files relevant to ongoing audits, investigations, or legal cases. Once applied, Legal Hold prevents users from deleting or modifying content, maintaining the integrity and defensibility of the preserved data. Legal Hold can target specific users, groups, or content repositories, minimizing disruption to unrelated content. Audit logs capture all actions on preserved content, supporting compliance and legal requirements.
Integration with Microsoft 365 ensures comprehensive coverage of communication channels, files, and collaboration spaces. Legal Hold also allows for exporting content to legal teams or auditors in a structured, defensible manner. This integration is critical because modern organizations rely heavily on a broad ecosystem of digital communication—Teams chats, SharePoint document libraries, Exchange mailboxes, OneDrive storage, and other collaborative workflows. Legal Hold ensures that all potentially relevant content across these environments is preserved in place, without interrupting user productivity. Users can continue to send email, create documents, and collaborate in Teams, while the system quietly and automatically retains immutable versions of any content that falls under a hold scope. This seamless preservation model ensures compliance without imposing operational friction.
In addition, Legal Hold supports advanced filtering and scoping, enabling organizations to refine the preservation set by custodians, date ranges, keywords, content types, or specific Microsoft 365 workloads. This level of precision is essential in legal and regulatory contexts, where requirements often demand that only information relevant to a particular matter be retained. Targeted holds reduce storage burdens, decrease data review costs, and limit unnecessary retention that could create additional compliance risk. When legal teams need to review or export preserved data, eDiscovery tools provide structured formats, metadata integrity, comprehensive audit logs, and a defensible chain of custody—ensuring all exported content meets evidentiary standards required by courts, auditors, or regulatory agencies.
Retention Labels can enforce preservation schedules, but are not case-specific and cannot prevent deletion for audits or investigations. Their primary purpose is information lifecycle management, which ensures data remains available for required durations and is disposed of when no longer necessary. Although Retention Labels can prevent deletion for a set period, they operate at the policy level rather than at the case level. They cannot be configured to preserve data tied to a specific investigation, nor can they dynamically adjust based on legal requirements. If an investigation arises, Retention Labels alone do not provide the flexibility or targeting required to preserve only relevant content while allowing unrelated data to follow standard retention procedures.
Data Loss Prevention monitors and blocks sensitive content sharing, but does not preserve content for legal purposes. DLP is designed to protect against data leakage, monitor user actions, and enforce policies around sensitive information movement. While this helps organizations avoid compliance violations and data breaches, DLP does not create immutable copies of content. If a user deletes an email or file that is later needed for legal review, DLP does nothing to recover or preserve that content. Thus, DLP and Legal Hold serve fundamentally different objectives: DLP prevents exposure, while Legal Hold ensures retention.
Communication Compliance monitors communications for policy violations but does not preserve content for audits. Its purpose is risk detection—identifying harassment, insider threats, inappropriate behavior, or regulatory communication breaches. Although it captures signals and flags incidents for review, it does not protect content from deletion or secure it for evidentiary purposes. Communication Compliance plays a complementary but distinct role within the compliance ecosystem.
eDiscovery Legal Hold is the correct solution because it ensures the retention of relevant content, prevents deletion, maintains audit trails, and meets legal and regulatory compliance standards. Unlike Retention Labels, it is targeted and investigation-specific. Unlike DLP, it secures content rather than preventing sharing. Unlike Communication Compliance, it preserves evidence rather than monitoring behavior. Implementing Legal Hold ensures defensible preservation for audits, investigations, and litigation. It provides organizations with a reliable, transparent, and legally sound mechanism for safeguarding content, enabling legal teams to confidently navigate discovery processes, respond to regulatory inquiries, and demonstrate compliance with court-mandated preservation orders. With Legal Hold, organizations maintain control, accountability, and evidentiary integrity throughout every phase of the investigative lifecycle.
Question 198:
You want to detect potential insider threats where employees might upload sensitive project files to personal accounts. Which feature should you implement?
A) Insider Risk Management
B) Data Loss Prevention
C) Sensitivity Labels
D) Retention Labels
Answer: A
Explanation:
Insider Risk Management in Microsoft 365 helps detect risky user behavior, such as attempts to exfiltrate sensitive files to personal cloud accounts. It uses machine learning and behavioral analytics to monitor user actions, identify anomalies, and assign risk scores based on activity patterns. Risk signals can include unusual downloads, bulk access of sensitive files, or attempts to bypass security controls. Alerts are generated for security or compliance teams, providing context for investigation and remediation.
Integration with OneDrive, SharePoint, Teams, and Exchange ensures comprehensive monitoring across all repositories. Organizations can configure policies by department, role, or content type to proactively reduce risk exposure. Detailed contextual information helps distinguish between malicious, accidental, or benign activities. This context is essential because insider risk is rarely a single event; instead, it emerges from patterns of activity that may indicate intentional data theft, elevated frustration, negligent handling of sensitive materials, or compromised accounts being misused by external actors. By analyzing trends such as unusual file downloads, atypical access to confidential documents, repeated sharing attempts to personal accounts, or abnormal login times, Insider Risk Management (IRM) can surface early indicators that would otherwise go unnoticed.
IRM also uses machine learning models to identify deviations from baseline user behavior. Instead of relying solely on static rules, the system dynamically learns what constitutes normal activity for specific users, departments, or job functions. For example, a finance analyst may frequently interact with financial statements, but mass downloading customer PII from multiple SharePoint libraries might fall outside typical behavior. Similarly, an HR specialist may handle employee records daily, but exporting sensitive files to personal cloud storage is a strong risk signal. This adaptive intelligence allows IRM to reduce false positives and ensure that alerts are meaningful, relevant, and actionable for security teams.
Another benefit of IRM is its ability to include organizational context, such as employee resignations, performance issues, HR reports, or changes in job responsibilities—factors that often correlate with increased insider risk. For example, an employee who recently submitted a resignation notice may be more likely to exfiltrate intellectual property, customer lists, or strategic documents. IRM can automatically increase monitoring sensitivity for such users, helping security teams detect escalation patterns before data loss occurs. This capability aligns with industry research showing a significant percentage of insider incidents occur within days or weeks of an employee’s departure.
Furthermore, IRM provides detailed investigation workflows that enable security, HR, and legal teams to collaborate discreetly and effectively. Alerts include granular evidence such as file names, timestamps, access locations, user actions, and risk scores. Investigators can review timelines of events to understand the full sequence of behavior leading to an alert. Built-in case management tools allow administrators to escalate cases, apply access restrictions, require user training, or take disciplinary action when necessary. This structured approach not only supports internal governance but also ensures that responses to insider threats are consistent, defensible, and compliant with organizational policies.
Data Loss Prevention can block sharing, but does not evaluate behavior or assign risk scores over time. While DLP is essential for controlling sensitive data movement, it is reactive and content-centric. It cannot determine whether unusual data access patterns reflect negligence, malicious intent, or compromised credentials. Nor does it retain long-term behavioral context, which is essential for identifying subtle or slow-developing insider risks.
Sensitivity Labels protect content through encryption, but cannot detect risky behavior. Labels secure data wherever it travels, but do not analyze how users interact with that data. They cannot detect suspicious downloads, unauthorized copying, or attempts to move sensitive files to unsafe locations.
Retention Labels preserve content for compliance but do not identify insider threats. Their purpose is governance and lifecycle management—not behavioral monitoring, risk scoring, or threat detection. Retention policies ensure data is kept or disposed of correctly, but cannot identify misuse or unusual access.
Insider Risk Management is the correct solution because it monitors user behavior, identifies risky activity, generates actionable alerts, and enables proactive intervention. Unlike DLP, it is behavior-focused; unlike Sensitivity Labels, it monitors actions rather than securing content; and unlike Retention Labels, it is proactive rather than lifecycle-focused. Implementing Insider Risk Management helps prevent data exfiltration, supports regulatory compliance, reduces organizational risk, and strengthens the security posture against internal threats that traditional tools cannot adequately detect.
Question 199:
You want to enforce just-in-time activation of privileged administrative roles with approval workflows. Which feature should you implement?
A) Privileged Access Management
B) Conditional Access
C) Identity Protection
D) Data Loss Prevention
Answer: A
Explanation:
Privileged Access Management (PAM) in Microsoft 365 allows organizations to enforce just-in-time (JIT) activation of administrative roles. Administrators must request temporary elevated privileges and provide business justification for approval. PAM integrates approval workflows, multi-factor authentication, and auditing to ensure accountability, governance, and compliance.
Integration with Azure AD and Microsoft 365 workloads ensures consistent enforcement across Exchange, SharePoint, Teams, and OneDrive. All privileged actions, including activation requests, approvals, and performed tasks, are logged for auditing. Role-specific workflows can provide additional scrutiny for critical roles, reducing risk exposure. PAM aligns with zero-trust principles by minimizing standing privileges and limiting attack surfaces.
Conditional Access controls access based on identity, device, or location, but does not enforce JIT privileged workflows. Identity Protection detects risky sign-ins but does not manage role activation. Data Loss Prevention protects content but does not control administrative privileges.
Privileged Access Management is the correct solution because it enforces temporary activation, approval workflows, auditing, and reduces the risk of standing privileges. Unlike Conditional Access, it focuses on workflow management; unlike Identity Protection, it manages role activation; and unlike DLP, it governs administrative actions rather than content.
Question 200:
You want to classify and encrypt all HR documents containing sensitive employee information stored in SharePoint and OneDrive. Which feature should you implement?
A) Sensitivity Labels
B) Data Loss Prevention
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Sensitivity Labels in Microsoft 365 allow organizations to classify and protect documents containing sensitive HR information, such as employee records, payroll data, or performance reviews. Once applied, these labels can enforce encryption, control access to authorized users, and restrict actions like copying, printing, or sharing outside approved recipients. Labels can be applied automatically based on content inspection, keywords, or predefined sensitive information types.
Persistent protection ensures that security controls remain effective even if documents are downloaded or shared externally. Administrators can monitor access, generate compliance reports, and detect unauthorized attempts to open or modify sensitive content. Recommended labeling guides users in applying the correct label, reducing human error, and ensuring consistent enforcement of organizational policies. This built-in guidance is particularly important in departments like HR, where confidentiality requirements are strict, and the consequences of mislabeling are significant. When employees receive automated prompts recommending a label based on content analysis—such as documents containing employee identification numbers, benefits information, performance records, or compensation data—it greatly reduces the likelihood of accidental oversharing. These recommendations also promote consistent classification practices throughout the organization, supporting broader compliance and information governance initiatives.
Sensitivity Labels apply encryption at the document level, ensuring access permissions travel with the file itself rather than relying on the security of the surrounding environment. Even if a labeled HR document is saved offline, forwarded via email, or stored on a non-Microsoft platform, the embedded encryption prevents unauthorized users from opening or reading its contents. Furthermore, administrators can configure labels to enforce additional controls such as preventing printing, disabling copying or screenshotting, or restricting forwarding. These capabilities are particularly valuable for HR teams who handle sensitive employee records, disciplinary actions, medical information, and other forms of personally identifiable information (PII) that must be safeguarded under regulations such as HIPAA, GDPR, or various national labor laws.
Auditing and reporting features provide administrators with detailed visibility into how sensitive content is accessed and used. These logs help identify potential misuse, detect anomalies such as repeated failed access attempts, and support compliance investigations. For example, if an unauthorized user attempts to open a protected HR document, the system records the attempted access, the device used, and the timestamp, enabling security teams to respond quickly. Audit trails also assist organizations in demonstrating compliance during regulatory audits, internal investigations, or external assessments.
Data Loss Prevention can block the sharing of sensitive content, but does not encrypt or enforce access controls within the document itself. While DLP is effective at preventing content from being improperly sent outside of approved channels, it does not protect once the content is successfully shared or downloaded. If a document leaves the organization, DLP cannot stop unauthorized access to its contents. In contrast, Sensitivity Labels maintain persistent protection that follows the file everywhere.
Retention Labels preserve or delete content according to lifecycle policies but do not restrict access. Their purpose is to ensure that documents are stored for the correct amount of time, retained for audits, or permanently deleted when no longer needed. Although essential for compliance, retention policies do not prevent unauthorized users from opening or editing sensitive HR files. They focus on time-based governance, not on content protection or access security.
Conditional Access governs access to applications or services, but does not directly secure the document content. It can ensure that only compliant devices, trusted networks, or authorized users can sign in to Microsoft 365, but once a file is downloaded, Conditional Access cannot enforce how that document is handled. It controls entry to systems but not persistent security on documents themselves.
Sensitivity Labels are the correct solution because they enforce persistent protection, encryption, and access restrictions for sensitive HR documents. Unlike DLP, they secure content rather than just monitoring sharing; unlike Retention Labels, they focus on protection rather than content lifecycle; and unlike Conditional Access, they protect the document itself rather than the environment. Implementing Sensitivity Labels ensures HR data is confidential, compliant, and secure while enabling authorized collaboration. HR teams can continue working efficiently while the organization maintains strong, consistent control over sensitive information, reducing risk exposure and supporting regulatory compliance across all stages of the document’s lifecycle.
Question 201:
You want to prevent employees from accidentally sharing payroll documents externally while allowing internal collaboration. Which feature should you implement?
A) Data Loss Prevention
B) Sensitivity Labels
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Data Loss Prevention (DLP) allows organizations to detect sensitive payroll information and prevent accidental or unauthorized external sharing while enabling internal collaboration. DLP policies can identify content like Social Security numbers, salary data, or tax information using predefined sensitive information types or custom patterns. When a user attempts to share restricted content externally via Teams, SharePoint, OneDrive, or email, DLP can block the action, display a policy tip, and optionally notify administrators.
DLP policies apply across all Microsoft 365 workloads, ensuring consistent protection and compliance. Reporting features allow administrators to monitor incidents, analyze trends, and adjust policies to balance security with productivity. Temporary overrides with justification can be configured for business flexibility while maintaining security.
Sensitivity Labels encrypt and restrict access to content but do not block accidental sharing in real-time. Retention Labels enforce content preservation schedules but do not prevent external sharing. Conditional Access governs access based on identity, device, or location, but does not inspect content for sensitive information.
DLP is the correct solution because it actively monitors content, enforces sharing restrictions, educates users, and provides administrative alerts. Unlike Sensitivity Labels, it governs behavior rather than just securing content; unlike Retention Labels, it provides real-time protection; and unlike Conditional Access, it protects the content itself rather than access.
Question 202:
You need to preserve emails and Teams messages for a regulatory investigation and ensure they cannot be deleted. Which feature should you implement?
A) eDiscovery Legal Hold
B) Retention Labels
C) Data Loss Prevention
D) Communication Compliance
Answer: A
Explanation:
eDiscovery Legal Hold preserves emails, Teams messages, SharePoint files, and OneDrive content relevant to regulatory investigations. Once applied, content cannot be deleted or modified, ensuring evidence remains intact and defensible. Legal Hold can target specific users, groups, or repositories, minimizing disruption to unrelated content. Audit logs track all activity, supporting compliance and legal requirements.
Integration across Microsoft 365 ensures comprehensive coverage of communication channels and collaboration files. Legal Hold also allows content export for review by legal teams or auditors, maintaining a structured, defensible process for investigations.
Retention Labels enforce preservation schedules but are not case-specific and cannot selectively prevent deletion for investigations. DLP monitors sensitive content sharing but does not preserve content for legal purposes. Communication Compliance monitors policy violations but does not preserve content for investigations.
eDiscovery Legal Hold is the correct solution because it ensures content retention, prevents deletion, maintains audit trails, and ensures regulatory compliance. Unlike Retention Labels, it is targeted and investigation-specific. Unlike DLP, it preserves content rather than preventing sharing. Unlike Communication Compliance, it preserves evidence rather than monitoring behavior.
Question 203:
You want to detect employees trying to upload confidential project files to personal cloud accounts. Which feature should you implement?
A) Insider Risk Management
B) Data Loss Prevention
C) Sensitivity Labels
D) Retention Labels
Answer: A
Explanation:
Insider Risk Management identifies risky behavior in Microsoft 365, such as attempts to exfiltrate confidential files to personal cloud storage. Using machine learning and behavioral analytics, it monitors user actions, detects anomalies, and assigns risk scores. Alerts are generated for compliance or security teams, providing context for investigation. Detailed information about user activity, content accessed, and historical behavior helps differentiate between malicious, accidental, or benign activities.
Integration with OneDrive, SharePoint, Teams, and Exchange ensures comprehensive coverage. Policies can be tailored to departments, roles, or content types. Alerts allow proactive intervention, preventing data exfiltration and ensuring regulatory compliance.
DLP blocks content sharing but does not evaluate user behavior over time. Sensitivity Labels protect content but do not detect risky behavior. Retention Labels preserve content but do not monitor insider threats.
Insider Risk Management is correct because it evaluates behavior, identifies risky activities, generates alerts, and allows proactive mitigation. Unlike DLP, it is behavior-focused; unlike Sensitivity Labels, it monitors activity; unlike Retention Labels, it is proactive rather than lifecycle-based.
Question 204:
You want to enforce temporary activation of privileged administrative roles with approval workflows. Which feature should you implement?
A) Privileged Access Management
B) Conditional Access
C) Identity Protection
D) Data Loss Prevention
Answer: A
Explanation:
Privileged Access Management (PAM) allows just-in-time activation of administrative roles. Administrators must request temporary elevated access and provide justification. PAM integrates approval workflows, multi-factor authentication, and auditing for accountability and compliance.
Integration with Azure AD and Microsoft 365 workloads ensures consistent enforcement. Audit logs track all privileged actions. Role-specific workflows provide additional oversight for critical roles, reducing risks. PAM aligns with zero-trust principles by minimizing standing privileges and attack surfaces.
Conditional Access controls access based on identity, device, or location, but does not manage privileged workflows. Identity Protection detects risky sign-ins but does not enforce temporary role activation. DLP protects content but does not manage privileges.
PAM is correct because it enforces temporary activation, approval workflows, auditing, and reduces risks associated with standing privileges. Unlike Conditional Access, it manages privileged workflows; unlike Identity Protection, it governs role activation; unlike DLP, it controls administrative actions rather than content.
Question 205:
You want to automatically classify and encrypt all legal documents stored in SharePoint and OneDrive. Which feature should you implement?
A) Sensitivity Labels
B) Data Loss Prevention
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Sensitivity Labels in Microsoft 365 allow organizations to classify and protect sensitive legal documents by applying encryption, access restrictions, and usage limitations. When a label is applied, it can enforce rules such as limiting access to specific individuals or groups, preventing copying or printing, and restricting external sharing. Labels can be applied manually by users or automatically based on content analysis, keywords, or predefined sensitive information types, ensuring consistent protection across SharePoint, OneDrive, Teams, and Exchange Online.
Persistent protection ensures that security controls remain effective even if documents are downloaded or shared outside the organization. Administrators can monitor document access, track usage, and generate compliance reports. Sensitivity Labels also provide recommended labeling for users to reduce human error while enforcing organizational policies.
Data Loss Prevention (DLP) can detect sensitive content and prevent unauthorized sharing, but it does not embed encryption or enforce access restrictions persistently within the document itself. Retention Labels manage content lifecycle by preserving or deleting content according to schedules, but do not secure documents or restrict access. Conditional Access governs access based on identity, device, or location, but does not directly secure document content.
Sensitivity Labels are the correct solution because they provide persistent classification, encryption, and access control for legal documents. Unlike DLP, they protect content rather than just monitoring sharing; unlike Retention Labels, they enforce security rather than content lifecycle; and unlike Conditional Access, they protect the document itself rather than controlling access to the application. Implementing Sensitivity Labels ensures legal documents remain confidential, compliant, and secure while enabling authorized collaboration.
Question 206:
You want to prevent employees from accidentally sharing payroll spreadsheets externally while maintaining internal collaboration. Which feature should you implement?
A) Data Loss Prevention
B) Sensitivity Labels
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Data Loss Prevention (DLP) in Microsoft 365 enables organizations to detect and prevent the sharing of sensitive payroll information outside the organization while allowing internal collaboration. DLP policies can identify content containing Social Security numbers, salary information, or tax-related data using predefined sensitive information types or custom patterns. When a user attempts to share restricted content externally, DLP can block the action, display a policy tip explaining the risk, and optionally notify administrators for further review.
DLP applies across Microsoft 365 workloads, including Exchange, SharePoint, OneDrive, and Teams. Reporting capabilities provide visibility into incidents, trends, and repeat offenders, allowing administrators to fine-tune policies or deliver training where needed. Temporary overrides with justification can maintain business flexibility while enforcing security.
Sensitivity Labels encrypt and restrict access to documents, but do not block real-time external sharing. Retention Labels enforce content preservation schedules but cannot prevent external sharing. Conditional Access controls application access based on identity, device, or location, but does not inspect content for sensitive data.
DLP is the correct solution because it actively monitors content, enforces external sharing restrictions, educates users via policy tips, and provides administrative alerts. Unlike Sensitivity Labels, it governs behavior rather than only securing content. Unlike Retention Labels, it enforces real-time protection. Unlike Conditional Access, it protects the content itself rather than controlling access to applications.
Question 207:
You need to preserve emails and Teams messages for a regulatory audit and ensure they cannot be deleted. Which feature should you implement?
A) eDiscovery Legal Hold
B) Retention Labels
C) Data Loss Prevention
D) Communication Compliance
Answer: A
Explanation:
eDiscovery Legal Hold allows organizations to preserve emails, Teams messages, SharePoint documents, and OneDrive content that are relevant to regulatory audits or legal investigations. Once applied, Legal Hold prevents users from deleting or modifying the content, ensuring the integrity of evidence. Legal Hold can target specific users, groups, or repositories, minimizing disruption to unrelated content. Audit logs capture all actions on preserved items, supporting regulatory compliance and legal defensibility.
Integration with Microsoft 365 workloads ensures comprehensive coverage across emails, files, and collaboration spaces. Legal Hold allows content to be exported for review in a structured, defensible manner for auditors or legal teams.
Retention Labels preserve content based on schedules but are not investigation-specific and cannot prevent deletion for audits. DLP monitors sensitive content sharing but does not preserve content. Communication Compliance monitors communications for policy violations but does not preserve content for audits.
eDiscovery Legal Hold is the correct solution because it ensures content retention, prevents deletion, maintains audit trails, and meets regulatory compliance requirements. Unlike Retention Labels, it is case-specific. Unlike DLP, it preserves content rather than preventing sharing. Unlike Communication Compliance, it preserves evidence rather than monitoring behavior.
Question 208:
You want to detect employees attempting to exfiltrate sensitive project files to personal cloud accounts. Which feature should you implement?
A) Insider Risk Management
B) Data Loss Prevention
C) Sensitivity Labels
D) Retention Labels
Answer: A
Explanation:
Insider Risk Management in Microsoft 365 identifies risky employee behaviors, including attempts to exfiltrate sensitive project files to personal cloud storage or external locations. It uses machine learning and behavioral analytics to detect anomalies such as unusual downloads, bulk access to confidential files, or attempts to bypass security policies. Risk scores are generated for users based on detected activity patterns, and alerts are sent to security or compliance teams for investigation.
Contextual information, such as which files were accessed, user history, and surrounding behavior, allows organizations to distinguish between malicious, accidental, or benign actions. Integration with OneDrive, SharePoint, Teams, and Exchange ensures comprehensive monitoring across collaboration platforms. Policies can be tailored by department, role, or content type. Proactive alerts allow timely intervention to prevent data leaks and maintain regulatory compliance.
Data Loss Prevention blocks sharing but does not monitor ongoing behavior. Sensitivity Labels secure content but do not detect risky activity. Retention Labels preserve content but cannot detect insider threats.
Insider Risk Management is the correct solution because it evaluates behavior, identifies risks, generates actionable alerts, and allows proactive mitigation. Unlike DLP, it is behavior-focused; unlike Sensitivity Labels, it monitors actions rather than securing content; and unlike Retention Labels, it is proactive rather than lifecycle-based.
Question 209:
You want to enforce just-in-time activation of privileged administrative roles with approval workflows. Which feature should you implement?
A) Privileged Access Management
B) Conditional Access
C) Identity Protection
D) Data Loss Prevention
Answer: A
Explanation:
Privileged Access Management (PAM) allows just-in-time activation of administrative roles in Microsoft 365. Administrators must request temporary elevated privileges and provide a business justification for approval. PAM integrates approval workflows, multi-factor authentication, and auditing for accountability, governance, and regulatory compliance.
Integration with Azure AD and Microsoft 365 workloads ensures consistent enforcement across Exchange, SharePoint, Teams, and OneDrive. All privileged activities are logged, including activation requests, approvals, and performed actions. Role-specific approval workflows add additional scrutiny for critical roles, minimizing misuse risk. PAM aligns with zero-trust principles by reducing standing privileges and limiting attack surfaces.
Conditional Access controls access based on device, location, or identity, but does not enforce just-in-time privileged workflows. Identity Protection detects risky sign-ins but does not manage administrative role activation. DLP protects content but does not govern privileges.
Privileged Access Management is the correct solution because it enforces temporary activation, approval workflows, auditing, and reduces standing privilege risks. Unlike Conditional Access, it manages workflow for privileges; unlike Identity Protection, it governs role activation; unlike DLP, it controls administrative actions rather than content.
Question 210:
You want to classify and protect all corporate legal documents with encryption and access restrictions. Which feature should you implement?
A) Sensitivity Labels
B) Data Loss Prevention
C) Retention Labels
D) Conditional Access
Answer: A
Explanation:
Sensitivity Labels allow classification and protection of corporate legal documents stored in SharePoint, OneDrive, Teams, and Exchange. Labels enforce encryption, access restrictions, and usage limits such as preventing printing, copying, or external sharing. They can be applied manually or automatically based on content inspection, keywords, or predefined sensitive information types, ensuring consistent application across workloads. Automatic labeling is especially valuable for legal documents because it reduces the reliance on end-user judgment and ensures that files containing legal terms, case identifiers, confidential agreements, privileged communications, or sensitive client information are consistently protected as soon as they are created or uploaded. This greatly minimizes the risk of accidental exposure and supports the confidentiality obligations associated with legal work.
Persistent protection ensures documents remain secure even if downloaded or shared externally. Administrators can monitor access, track attempts to bypass security, and generate compliance reports. Recommended labeling reduces human error while enforcing corporate policies. Because Sensitivity Labels embed encryption directly into the file, the security controls stay with the document regardless of where it travels—internal systems, external partners, mobile devices, or offline environments. Even if the document is forwarded outside the organization, unauthorized users cannot open it, ensuring that confidentiality remains intact. This is particularly important for legal departments that often manage documents containing proprietary business strategies, litigation materials, contracts, intellectual property, or personally identifiable information. Persistent encryption ensures that even if the file is mishandled, its contents remain inaccessible to those without proper permissions.
Administrators can configure Sensitivity Labels with fine-grained usage controls that reflect the needs of legal teams. For example, a “Highly Confidential – Legal” label may restrict printing to prevent physical distribution, block copying and pasting to limit data extraction, and prevent forwarding to ensure that legal documents remain in controlled communication channels. Labels can also enforce watermarking to visually signal confidentiality levels, providing an additional layer of deterrence against improper sharing. These features support compliance with internal governance requirements as well as external regulations such as data protection laws and industry-specific confidentiality standards.
Data Loss Prevention blocks sensitive content from being shared, but does not embed encryption or enforce access restrictions within the document. Although DLP is highly effective at preventing unauthorized sharing, its protection ends when the content leaves the Microsoft 365 ecosystem. Once a file is downloaded or shared outside approved channels, DLP can no longer control who opens or edits it. DLP is therefore complementary to Sensitivity Labels but not a replacement for document-level security.
Retention Labels manage the content lifecycle but do not secure the document. They determine how long documents are preserved and when they are disposed of, helping legal departments meet retention obligations for contracts, case files, and regulatory records. However, Retention Labels do not restrict access, prevent data leakage, or protect sensitive information stored within the document. Their purpose is governance, not protection.
Conditional Access controls access to applications but does not directly secure content. While Conditional Access can require trusted devices, compliant locations, or multi-factor authentication before users can log in, it does not apply protection to the document itself. If a document is downloaded, Conditional Access cannot prevent unauthorized access outside the controlled environment.
Sensitivity Labels are correct because they enforce persistent encryption, classification, and access control. Unlike DLP, they protect content directly; unlike Retention Labels, they focus on security; unlike Conditional Access, they protect the document rather than controlling app access. Implementing Sensitivity Labels ensures that legal documents remain secure, confidential, and compliant across their entire lifecycle. This allows legal professionals to collaborate effectively while maintaining strong protections that stay with the content at all times, greatly reducing risk and supporting organizational, contractual, and regulatory requirements.