Explanation:
Box 1: deployifNotExists
Effect
The deployifNotExists (DINE) effect is used when you want Azure Policy to automatically deploy a remediation or configuration (in this case, enabling Azure Disk Encryption) if a resource (the VM) is found to be non-compliant with the policy's rules.
The policy evaluates the VM during creation or update, and if the specified condition (e.g., encryption not enabled) is met, it triggers a template deployment to enable encryption.
This effect also supports a remediation task for existing non-compliant resources, which allows you to bring all current VMs into a compliant state.
Box 2: Sub1
Assignment scope
The correct scope to apply the Azure Policy definition is the specific subscription.
Explanation:
Azure Policy assignments apply to a defined scope and inherit down the hierarchy (management group -> subscription -> resource group -> resource).
To automatically encrypt all virtual machines deployed to one specific subscription out of many, you must assign the policy at that specific subscription level to ensure all current and future resources within it are evaluated against the policy.
Incorrect:
Management group: Applying the policy at the management group level would apply it to all subscriptions under that management group, not just the single specific one, which is contrary to the requirement.
The resource group: Applying the policy at the resource group level would only apply it to VMs within that specific resource group, not all virtual machines in the entire subscription.
Reference:
https://learn.microsoft.com/en-us/answers/questions/855987/how-to-define-the-custom-azure-policy-to-enfore-az