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Utilizing Azure DevTest Labs significantly aids in cost reduction by streamlining the management of virtual machines (VMs) throughout the development lifecycle. This service allows teams to efficiently create, manage, and operate VMs that can be used for development and testing purposes without the need for extensive manual intervention. By automating aspects such as VM configuration and disposal, DevTest Labs ensures that organizations only pay for the resources they actually use, which is a fundamental advantage in minimizing operating expenses.

This automated VM management allows developers and testers to quickly spin up environments that mimic production, facilitating faster development cycles and testing processes. Furthermore, DevTest Labs supports the application of policies and governance that help control costs by providing users with set quotas and limits on VM usage, further enhancing financial oversight related to development activities.

While the other options mention valuable functions within a development context, they do not directly speak to the primary advantage of cost reduction through automation as effectively as the first option does.