Explanation:
Box 1: SQL Server on Azure Virtual Machines
Project1 must meet the following requirements:
Have access to the operating system of the database server that hosts the app.
Have 25 TB of storage.
* SQL Server on Azure Virtual Machines
If your application needs access to the operating system (OS) of the database server, you should use Azure SQL Server on Azure Virtual Machines. This solution allows you to install and manage SQL Server within a virtual machine, giving you complete control over the OS and database engine.
Box 2: Azure SQL Managed Instance General Purpose Service
Project2 must meet the following requirements:
Have change data capture (CDC) enabled.
Support instance-level SQL auditing.
Support managed backups.
Have 10 TB of storage.
Offload reports.
Azure SQL Database and Azure SQL Managed Instance are Azure database solutions that support managed backups.
Azure SQL Managed Instance and Azure SQL Database Hyperscale both support 10 TB of storage. Azure SQL Managed Instance can store up to 32 TB, while Hyperscale can scale to 100 TB.
Azure SQL Managed Instance Max instance reserved storage
*-> General Purpose: up to 32 TB
Business Critical: up to 4 TB
Hardware generations have different characteristics, as described in the following table from
2025:

For Change Data Capture (CDC) within Azure, Azure SQL Database is a suitable choice, particularly when using Azure Data Factory or Azure Synapse Analytics. Both Azure SQL Database and SQL Server offer native CDC support.
Reference:
https://learn.microsoft.com/en-us/azure/azure-sql/virtual-machines/windows/sql-server-on-azure- vm-iaas-what-is-overview
https://learn.microsoft.com/en-us/azure/virtual-machines/disks-types
https://learn.microsoft.com/en-us/azure/azure-sql/managed-instance/resource-limits