Difference terminal VIsual Studio Code and Command Prompt

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I am observing different behavior by the Terminal in VS Code versus the Command Prompt. If I look in the settings, however, they seem both to be pointing to cmd.exe in the system32 folder and there is no specific profile utilized in VS code. Still, if I run 'poetry install', I get the message that it is blocked by group policy in the Command Prompt but not in VS code. Can anyone help me find how that can happen?

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