AI-103 Practice Question 17: Zero Retention Conversation State
Microsoft Azure AI Apps and Agents Developer Associate (AI-103) · Test 2 · question 7 of 10
A bank is building a multi-turn assistant on Foundry Agent Service. Its regulator requires that no conversation content be persisted by the service: every message must live only in the bank's own encrypted store. The assistant still has to answer follow-up questions like "and what about the joint account?" with the earlier turns in context.
How should the application handle conversation state?
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Answer:
By default the service stores response history server-side. Setting `store` to `false` stops that persistence, and the documentation is direct about the consequence: "You must carry forward the conversation context yourself by passing previous output items as input to the next request." Microsoft names this as the pattern for teams that want to minimize stored data or work in a zero-data-retention environment, which is precisely the regulator's requirement.
- A is wrong because conversations are *durable objects with unique identifiers* that persist items (messages, tool calls, tool outputs) server-side and can be reused across sessions. That is server-side persistence, which is what the regulator forbids. - B is wrong for the same reason: previous_response_id works only because the service retained the earlier response. Accepting the default keeps the history the bank may not keep. - C is self-defeating. previous_response_id points at a *stored* response; with store set to false there is nothing persisted for the ID to reference, so the context is simply lost.
Reference: Build with runtime components in Foundry Agent Service