The correct answers are A and D . Microsoft documents that with group-based licensing , licenses assigned to a group are automatically inherited by the group’s members. Therefore, if User1 is added to Group1 , User1 can receive the Microsoft 365 E3 license through group membership. Microsoft also documents that licenses can be assigned directly to individual users , so assigning a Microsoft 365 E3 license straight to User1 is also a complete solution.

Options B and C are incorrect because Conditional Access controls how users access cloud resources after sign-in; it does not grant product entitlements or service licenses. Microsoft licensing guidance separates access-policy controls from actual license assignment. In this scenario, the issue is lack of license entitlement, not access conditions. As a result, the valid solutions are either to make User1 a member of the licensed group or to assign the license directly to User1. Microsoft also notes that group-based licensing assignment can fail if required user properties such as usage location are missing, but among the available answer choices, the two complete license-granting actions are Add User1 to Group1 and Assign a license to User1 .