You are dividing a virtual network with the address space 10.10.0.0/16 into subnets for a web tier, an application tier and a database tier. Which statement about that is correct?

Microsoft Certified: Azure Fundamentals (AZ-900), objective architecture-and-services. Azure architecture and services medium

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The options

Correct Each subnet's range must fall inside the virtual network's address space and must not overlap another subnet in the same virtual network

Correct. A subnet is a subdivision of the network's space, and two subnets claiming the same addresses would leave routing with no answer, so Azure rejects both mistakes.

Not correct A subnet may use any private range, including one outside the virtual network's address space

Wrong. The subnet has to come out of the space the virtual network owns; if you need more room you add another address space to the network first.

Not correct Every address in a subnet's range is available to your resources

Wrong, and it bites people who size subnets tightly. Azure reserves five addresses in every subnet — the first four and the last — so a /29 yields three usable addresses rather than eight.

Not correct A subnet can span two virtual networks so that tiers can share one

Wrong. A subnet belongs to exactly one virtual network. Joining networks together is what peering and gateways are for.

Why

Subnets exist so you can segment a network and then treat the segments differently — attach different network security groups, route them differently, place tiers apart so that reaching one does not mean reaching the next. Two practical traps: five addresses per subnet are reserved by Azure, and address ranges that overlap another network you may one day want to peer with are a decision you cannot easily undo.

Where this comes from

Cited
Microsoft AZ-900 study guide skill area architecture-and-services.compute-and-networking

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