Microsoft 365 Administrator Expert MS-102 Practice Question

In Microsoft Entra ID, every group that is enabled for group-based licensing has a Licensing options panel. Inside that panel, the Assignment options setting controls how the service handles users who already have direct (individual) license assignments:

• Merge with existing licenses keeps any licenses that were assigned directly to the user and simply adds the services coming from the group. It never removes or overrides direct assignments, which satisfies the Contoso requirement.

• Replace existing licenses removes any direct assignments that overlap with the products being applied by the group, which would violate the requirement.

• Removing the product license from the group, or disabling group-based licensing altogether, would stop licenses from being issued but would not satisfy the other stated requirements.

Therefore, selecting Merge with existing licenses is the correct choice because it:

• Issues licenses only for the period during which the user is in the group.
• Leaves any individually assigned licenses untouched.
• Continues to surface conflict and error details in the Licenses > Overview > Errors blade of the group in the Entra admin center.

The other options either fail to protect existing direct assignments or disable the required group licensing functionality.