Thank you for responding. Your suggestion makes sense although it is clear there is no clear cut answer and from the overwhelming response to this questions seems that everyone is a bit "confused" as to what this is and is not. I am going to mark the answer correct, although I am still not totally sure.
That said, I did pass the exam!
Thank you again!
I passed too!
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Visual Grouping and Grouping using Labels:
Visual grouping: create a viz by placing category and sub-category into the column shelf and sales into the row shelf. Now your view will be updated to bar chart. now select the bars by control clicking in windows and create a group. now in visual grouping, your data will not combine it is just highlighted however you can see the newly created group into the data pane.
Grouping using labels: Now here same scenario as above just click on labels (ctl click) and create a group. in this your data will be combined and you can see a created group into data pane as well.