AWS Billing, Pricing, and Cost Management — Questions and Answers
Question 1: Which AWS pricing model allows you to commit to a consistent amount of compute usage (measured in $/hour) for a 1- or 3-year term in exchange for a discount of up to 66% compared to On-Demand pricing?
- Savings Plans (Correct answer)
- Reserved Instances
- Spot Instances
- Dedicated Hosts
Correct answer: Savings Plans
Savings Plans offer flexible discounts (up to 66%) in exchange for a commitment to a consistent dollar-per-hour spend over 1 or 3 years. Unlike Reserved Instances, Savings Plans automatically apply to any eligible compute usage (EC2, Fargate, Lambda) regardless of instance family or region.
Question 2: A company wants to receive an alert when its monthly AWS bill exceeds $500. Which AWS service should they use?
- AWS Cost Explorer
- AWS Budgets (Correct answer)
- AWS Pricing Calculator
- AWS Trusted Advisor
Correct answer: AWS Budgets
AWS Budgets lets you set custom cost, usage, or reservation budgets and triggers SNS/email alerts when thresholds are breached. Cost Explorer is for analyzing historical spend, the Pricing Calculator estimates future costs, and Trusted Advisor provides general best-practice recommendations.
Question 3: Which EC2 purchasing option is most appropriate for a fault-tolerant, stateless batch processing workload that can be interrupted and resumed, where minimizing cost is the top priority?
- On-Demand Instances
- Reserved Instances
- Spot Instances (Correct answer)
- Dedicated Instances
Correct answer: Spot Instances
Spot Instances use spare EC2 capacity and can be up to 90% cheaper than On-Demand, but can be interrupted with a 2-minute warning. They are ideal for stateless, fault-tolerant workloads like batch jobs that can checkpoint and resume.
Question 4: What is the purpose of the AWS Free Tier's '12 months free' category?
- Services that are permanently free for all AWS customers regardless of account age
- Services free for the first 12 months following your initial AWS account sign-up date (Correct answer)
- Services free for 12 months only if you purchase a Support plan
- Services free for 12 months only in the us-east-1 region
Correct answer: Services free for the first 12 months following your initial AWS account sign-up date
'12 months free' services (e.g., 750 hours/month of t2.micro EC2, 5 GB of S3 Standard storage) are available at no charge for the first 12 months after you create your AWS account. After that period, standard pay-as-you-go rates apply.
Question 5: Which AWS tool provides an interactive, graphical interface to visualize, understand, and manage your AWS costs and usage over time, including forecasting future spend?
- AWS Budgets
- AWS Cost and Usage Report (CUR)
- AWS Cost Explorer (Correct answer)
- AWS Billing Dashboard
Correct answer: AWS Cost Explorer
AWS Cost Explorer is the purpose-built tool for exploring, filtering, and graphing historical cost and usage data. It also provides a 12-month forecast. The CUR provides raw granular billing data, Budgets sets alerts, and the Billing Dashboard is a high-level summary.
Question 6: A company uses multiple AWS accounts under AWS Organizations. Which feature allows the company to pool Reserved Instance discounts across all member accounts?
- Consolidated Billing (Correct answer)
- AWS Control Tower
- Service Control Policies (SCPs)
- AWS Resource Access Manager
Correct answer: Consolidated Billing
Consolidated Billing in AWS Organizations combines usage across all member accounts into a single bill. This allows Reserved Instance and Savings Plans discounts purchased by any account to be shared across the organization, and also qualifies the combined usage for volume pricing tiers.
