Define an Outputs entry with an Export name in the network stack template is correct because the network stack must export the subnet ID so the application stack can import and reference that value.

The producing stack must declare an Outputs entry with an Export name and value so the consumer can read it. The consuming template then uses Fn::ImportValue to retrieve the exported subnet ID. This export and import pattern works only when both stacks are in the same AWS account and Region and it avoids manual copying or external storage of identifiers.

Fn::ImportValue is not sufficient by itself because it only imports a value that has already been exported. The producer must create the export in its Outputs section before the consumer can call Fn::ImportValue.

AWS Systems Manager Parameter Store could hold IDs but it is not the native CloudFormation cross-stack mechanism and using it introduces extra operational overhead and additional permissions to manage.

Fn::Transform invokes macros to transform templates and it does not provide a way to expose values across stacks so it is not applicable for sharing the subnet ID.

Full AWS Practitioner Certification Question