Resource Group is the answer:
When you assign roles, you must specify a scope. Scope is the set of resources the access applies to. In Azure, you can specify a scope at four levels from broad to narrow: management group, subscription, resource group, and resource. For more information, see Understand scope.
https://learn.microsoft.com/en-us/azure/role-based-access-control/role-assignments-portal
Basically either they want to catch you with "security principal" which is incorrect or there is a type. If it's a trick then the answer would be Resource Group
A security principal in Azure AD can refer to users, groups, service principals, or applications, all of which can be authenticated and authorized to access resources based on assigned permissions and roles within the directory.
Service principal.
On the Members tab, select User, group, or service principal to assign the selected role to one or more Microsoft Entra users, groups, or service principals (applications).
Click Select members. Find and select the users, groups, or service principals.
https://learn.microsoft.com/en-us/azure/role-based-access-control/role-assignments-portal#:~:text=On%20the%20Members%20tab%2C%20select,%2C%20groups%2C%20or%20service%20principals.
Security principal should be the answer.
You can assigns security principal to an Azure AD Role.
You cannot directly assign a resource group to Azure AD Role.
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