Which type of entity is utilized for server-side business logic that requires a Dynamics 365 license?

The correct type of entity that is utilized for server-side business logic and requires a Dynamics 365 license is the standard entity. In Dynamics 365, standard entities are predefined and come with the platform; they play a crucial role in the out-of-the-box functionalities of the application.

Standard entities benefit from robust server-side logic, such as workflows and plugins. These entities generally require licensing due to their integration within Dynamics 365, which encompasses various applications and functionalities.

The other entities mentioned, such as complex and simple entities, aren't standard terminology within the Dynamics 365 context. Custom entities are user-defined and can also have associated business logic, but they do not specifically need a Dynamics 365 license to exist. Instead, they follow the licensing rules associated with the overall Dynamics 365 applications, where certain features or capabilities may require licensing based on the use of standard entities.

Understanding these distinctions helps clarify how various types of entities function within the Dynamics 365 ecosystem and their considerations regarding licensing.