What is the purpose of setting resource limits in Azure SQL Database?

Setting resource limits in Azure SQL Database primarily serves the purpose of controlling costs and ensuring performance. By specifying limits on resources such as CPU, memory, and storage, organizations can manage how much they spend on database services while also optimizing the performance based on their application requirements.

When resources are limited, it prevents any single application or workload from monopolizing resources, which can lead to performance degradation for other applications using the same database instance. This is particularly important in cloud environments where costs are aligned with usage; organizations can avoid unexpected expenses by clearly defining what resources an application can consume.

Furthermore, effective resource management can help maintain consistent response times for users and applications, avoiding scenarios where high-demand workloads slow down overall database performance.

The other options may address specific concerns, but they do not encompass the broader implications of resource limits related to cost management and performance optimization. Limiting application access, restricting data storage, and increasing data retention do not directly relate to resource limits in the way that cost control and performance assurance do.