Billing Basics — CLF-C02 practice questions

Practice questions for this topic, with explained answers.

Domain: Billing, Pricing, and Support ·100 questions · 30 easy · 40 intermediate · 30 hard · page 1 of 7

Question 1 clf-billing-basics-001

Easy · Choose one

Which Amazon EC2 purchasing option lets a company pay for compute capacity by the second with no upfront payment and no long-term commitment?

  1. a On-Demand Instances
  2. b Spot Instances
  3. c Reserved Instances
  4. d Dedicated Hosts
Show answer & explanation

Answer: A

Why A is correct

On-Demand is the baseline EC2 pricing model: capacity is billed as it is consumed, with no upfront fee and no term commitment, so the customer can start and stop instances freely. AWS bills EC2 usage in one-second increments with a 60-second minimum. The trade-off is that On-Demand carries the highest per-hour rate of the shared-tenancy pricing models, higher than Spot, Reserved Instances, and Savings Plans, which is why AWS positions it for short-term, spiky, or unpredictable workloads that cannot be interrupted.

Why the others are wrong

  • B — Spot Instances have no term commitment, but they are not simply pay-as-you-go: they draw on spare EC2 capacity and AWS can reclaim the instance with a two-minute warning, so they are not the option AWS describes as uncommitted pay-as-you-go capacity.
  • C — Reserved Instances are a billing commitment to a consistent amount of usage for a 1-year or 3-year term. They lower the rate but are the opposite of 'no long-term commitment'.
  • D — Dedicated Hosts allocate an entire physical server to one customer and are billed per host. They can be purchased On-Demand, but the defining characteristic is single-tenant hardware, not uncommitted per-second pricing.

Last verified: 2026-09-01

Question 2 clf-billing-basics-002

Easy · Choose one

Which Amazon EC2 purchasing option can provide the largest discount compared with On-Demand pricing, at up to 90%?

  1. a Spot Instances
  2. b Dedicated Instances
  3. c Standard Reserved Instances
  4. d Compute Savings Plans
Show answer & explanation

Answer: A

Why A is correct

Spot Instances use spare Amazon EC2 capacity and AWS advertises savings of up to 90% off the On-Demand price. The discount is that large because the capacity is not guaranteed: when AWS needs the capacity back it reclaims the instance after a two-minute interruption notice. That risk is the reason Spot is priced below every committed-use option.

Why the others are wrong

  • B — Dedicated Instances address tenancy requirements by running on hardware dedicated to a single customer account. They carry a price premium over shared tenancy rather than a discount.
  • C — Standard Reserved Instances provide the largest discount of the Reserved Instance types, but the maximum AWS advertises for committed-use compute is up to 72%, not 90%.
  • D — Compute Savings Plans provide savings of up to 66% off On-Demand in exchange for a 1-year or 3-year hourly spend commitment. That is a substantial discount, but it is not the deepest one AWS offers.

Last verified: 2026-09-01

Question 3 clf-billing-basics-003

Easy · Choose one

How is a commitment under AWS Savings Plans expressed?

  1. a As a lump sum of prepaid credits that is drawn down as usage occurs
  2. b As a fixed number of instance hours per month for one specific instance type
  3. c As a consistent amount of compute usage measured in USD per hour, for a 1-year or 3-year term
  4. d As a percentage of the account's total monthly AWS bill
Show answer & explanation

Answer: C

Why C is correct

A Savings Plan is a commitment to spend a chosen dollar amount per hour on eligible usage for a fixed term, which is 1 or 3 years for Compute, EC2 Instance, and SageMaker AI Savings Plans and 1 year for Database Savings Plans. Usage up to that hourly commitment is charged at the discounted Savings Plans rate; anything above it is charged at On-Demand rates. Expressing the commitment in dollars per hour rather than in instance hours is what gives Savings Plans their flexibility, because the same commitment can be met by different instance types, sizes, and in the case of Compute Savings Plans, different services and Regions.

Why the others are wrong

  • A — Prepaid credits are a separate billing construct. Compute, EC2 Instance, and SageMaker AI Savings Plans offer All Upfront, Partial Upfront, and No Upfront payment options, and Database Savings Plans are No Upfront, but in every case the commitment itself is a rate of spend per hour rather than a credit balance.
  • B — Committing to a specific instance type for a set number of hours describes the older Reserved Instance model, not Savings Plans. Savings Plans deliberately avoid tying the commitment to a single instance type.
  • D — AWS does not offer a discount expressed as a percentage of the total bill. Savings Plans discounts apply only to the eligible compute or database usage that the plan covers.

Last verified: 2026-09-01

Question 4 clf-billing-basics-004

Easy · Choose one

Which workload is the best candidate for Amazon EC2 Spot Instances?

  1. a A steady-state web tier that will run continuously for the next three years
  2. b A batch image-processing job that checkpoints its progress and can be stopped and resumed without losing work
  3. c A licensing-restricted application that must run on hardware whose physical cores the customer can account for
  4. d A month-end payroll run that must complete in a single uninterrupted window
Show answer & explanation

Answer: B

Why B is correct

Spot Instances can be reclaimed by AWS at any time with a two-minute notice, so the deciding question is always whether the workload tolerates interruption. A checkpointed batch job does: if an instance is reclaimed, the job resumes from the last checkpoint on new capacity, and the workload captures the discount without risking data loss. Fault-tolerant, stateless, flexible, and time-insensitive workloads are the classic Spot fit.

Why the others are wrong

  • A — A predictable workload running continuously for three years is the textbook case for a Savings Plan or a 3-year Reserved Instance, which convert that predictability into a committed-use discount.
  • C — Physical core visibility is a tenancy and licensing requirement met by Dedicated Hosts, which is an independent dimension from Spot pricing.
  • D — A run that must complete in one uninterrupted window is exactly what Spot cannot guarantee, because AWS may reclaim the capacity mid-run. On-Demand or a committed-use option is appropriate here.

Last verified: 2026-09-01

Question 5 clf-billing-basics-005

Easy · Choose one

A company must run a workload on a physical server where it can see and account for the sockets and cores, so that it can bring its own per-socket software licenses. Which Amazon EC2 option meets this requirement?

  1. a On-Demand Capacity Reservations
  2. b Dedicated Hosts
  3. c Zonal Reserved Instances
  4. d Dedicated Instances
Show answer & explanation

Answer: B

Why B is correct

A Dedicated Host is a physical EC2 server allocated entirely to one customer, and it exposes the sockets, cores, and host ID. That visibility is what makes it possible to satisfy licenses that are counted per socket, per core, or per VM, such as Windows Server, SQL Server, SUSE Linux Enterprise Server, and Red Hat Enterprise Linux licenses bound to physical hardware. Dedicated Hosts are billed per host rather than per instance.

Why the others are wrong

  • A — An On-Demand Capacity Reservation reserves EC2 capacity in a specific Availability Zone. It says nothing about tenancy or hardware visibility, so it does not address a per-socket licensing requirement.
  • C — A zonal Reserved Instance is a billing and capacity construct. It does not change instance tenancy or expose the underlying physical hardware.
  • D — Dedicated Instances also run on single-tenant hardware, but they give the customer no visibility into sockets, cores, or host ID, so they cannot satisfy licenses that must be counted against physical hardware. Their BYOL support is limited to scenarios such as SQL Server with License Mobility.

Last verified: 2026-09-01

Question 6 clf-billing-basics-006

Easy · Choose one

How does AWS bill Amazon EC2 usage for Linux instances?

  1. a In one-minute increments, with a minimum of five minutes
  2. b In one-second increments, with a minimum of 60 seconds
  3. c Rounded up to the nearest full hour
  4. d Rounded up to the nearest full day
Show answer & explanation

Answer: B

Why B is correct

AWS states that Amazon EC2 usage is billed in one-second increments with a 60-second minimum, and this applies across the purchasing options. Fine-grained billing matters for cloud economics because it means short-lived and elastic workloads pay only for the time they actually consume, which is a core part of the pay-as-you-go value proposition.

Why the others are wrong

  • A — There is no five-minute minimum for EC2. The documented minimum is 60 seconds.
  • C — Hourly rounding was the original EC2 billing model, but AWS moved to per-second billing. A question keyed to hourly rounding reflects out-of-date pricing behavior.
  • D — AWS does not bill EC2 compute per day. Daily granularity appears in cost reporting, not in how the usage itself is metered.

Last verified: 2026-09-01

Question 7 clf-billing-basics-007

Intermediate · Choose one

A company purchased three-year Reserved Instances but expects its application's instance requirements to change during the term. It wants the ability to exchange the reservation itself for one with different instance attributes. Which Reserved Instance type should it have purchased?

  1. a Zonal Reserved Instances
  2. b Regional Reserved Instances
  3. c Convertible Reserved Instances
  4. d Standard Reserved Instances
Show answer & explanation

Answer: C

Why C is correct

Convertible Reserved Instances can be exchanged for another Convertible Reserved Instance with different attributes, such as a different instance family, operating system, or tenancy, as long as the exchange results in a reservation of equal or greater value. That flexibility is bought at the cost of a smaller discount than a Standard Reserved Instance provides. Convertible is the correct choice whenever the workload's shape is expected to change within the term.

Why the others are wrong

  • A — Zonal versus regional describes the scope of a Reserved Instance, which controls capacity reservation and flexibility of application. Scope is a separate attribute from whether the reservation is Standard or Convertible.
  • B — Regional scope gives Availability Zone flexibility and, under certain conditions, instance size flexibility, but it does not allow the reservation to be exchanged for a different instance family.
  • D — Standard Reserved Instances provide the deepest Reserved Instance discount but explicitly cannot be exchanged. They can be modified within limits, for example changing Availability Zone or scope, but not exchanged for a different instance family.

Last verified: 2026-09-01

Question 8 clf-billing-basics-008

Intermediate · Choose one

A team needs both a billing discount on Amazon EC2 and a guaranteed reservation of capacity in one specific Availability Zone. Which purchase should it make?

  1. a A regional Reserved Instance
  2. b A zonal Reserved Instance
  3. c A Compute Savings Plan
  4. d An EC2 Instance Savings Plan
Show answer & explanation

Answer: B

Why B is correct

A Reserved Instance purchased with zonal scope reserves capacity in the Availability Zone specified, in addition to providing the billing discount. This is the only one of the listed options that does both. The trade-off is rigidity: a zonal Reserved Instance applies only to the exact instance family, size, and Availability Zone specified, with no size or Availability Zone flexibility.

Why the others are wrong

  • A — A regional Reserved Instance provides a billing discount and applies across any Availability Zone in the Region, but AWS documentation is explicit that it does not reserve capacity. This is one of the most commonly missed distinctions on the exam.
  • C — Savings Plans of every type are purely billing constructs. A Compute Savings Plan lowers the rate on eligible EC2, AWS Fargate, and AWS Lambda usage but never reserves capacity.
  • D — An EC2 Instance Savings Plan commits to a specific instance family in a specific Region for a lower rate, but like all Savings Plans it provides no capacity reservation.

Last verified: 2026-09-01

Question 9 clf-billing-basics-009

Intermediate · Choose one

Under which condition does a regional Reserved Instance discount apply across different instance sizes within the same instance family?

  1. a When the Reserved Instance has zonal scope
  2. b When the Reserved Instance is purchased with the All Upfront payment option
  3. c When the Reserved Instance is Convertible rather than Standard
  4. d When the Reserved Instance is for Linux/Unix with default tenancy
Show answer & explanation

Answer: D

Why D is correct

Instance size flexibility lets a regional Reserved Instance discount apply across sizes in the same family using normalization factors, so a reservation for one size can cover several smaller instances or part of a larger one. AWS limits this benefit to Amazon Linux/Unix Reserved Instances with default tenancy. Reservations for other platforms, such as Windows, or for dedicated tenancy do not receive size flexibility.

Why the others are wrong

  • A — Zonal scope removes flexibility rather than granting it. A zonal Reserved Instance applies only to the exact family, size, and Availability Zone specified.
  • B — The payment option affects only how much of the cost is paid in advance and therefore the size of the discount. It has no bearing on whether the discount flexes across instance sizes.
  • C — Convertible Reserved Instances allow the reservation to be exchanged for different attributes, which is a different mechanism from automatic size flexibility within a family.

Last verified: 2026-09-01

Question 10 clf-billing-basics-010

Intermediate · Choose one

A company runs a steady Amazon EC2 workload that will stay on one instance family in a single AWS Region for the next three years. It does not run AWS Lambda or AWS Fargate. Which Savings Plans type provides the deepest discount for this profile?

  1. a Compute Savings Plans, which provide savings of up to 66%
  2. b SageMaker AI Savings Plans, which provide savings of up to 64%
  3. c EC2 Instance Savings Plans, which provide savings of up to 72%
  4. d Database Savings Plans, which provide savings of up to 35%
Show answer & explanation

Answer: C

Why C is correct

EC2 Instance Savings Plans commit to a specific instance family in a specific Region and, in exchange for that narrower scope, offer the deepest Savings Plans discount at up to 72% off On-Demand. Within that family and Region the plan still flexes across instance size, operating system, and tenancy, which is enough flexibility for a workload whose family and Region are fixed.

Why the others are wrong

  • A — Compute Savings Plans are the most flexible type, automatically applying across EC2, Lambda, and Fargate usage regardless of instance family, size, Region, operating system, or tenancy. That flexibility costs discount depth, capping at up to 66%.
  • B — SageMaker AI Savings Plans apply to Amazon SageMaker AI machine learning instance usage and would not cover this company's general-purpose EC2 workload at all.
  • D — Database Savings Plans apply to managed database services such as Amazon Aurora, Amazon RDS, and Amazon DynamoDB. They do not cover EC2 compute.

Last verified: 2026-09-01

Question 11 clf-billing-basics-011

Intermediate · Choose one

Which statement correctly describes AWS Compute Savings Plans?

  1. a They automatically apply to eligible Amazon EC2, AWS Fargate, and AWS Lambda usage regardless of instance family, size, AWS Region, operating system, or tenancy
  2. b They can be resold to other AWS customers if the workload is retired early
  3. c They apply only to the specific instance family and AWS Region named at purchase
  4. d They reserve compute capacity in a chosen Availability Zone for the duration of the term
Show answer & explanation

Answer: A

Why A is correct

Compute Savings Plans are the most flexible commitment AWS offers. The plan is a dollars-per-hour commitment that is applied automatically to eligible usage across EC2 instance families, sizes, Regions, operating systems, and tenancies, and across AWS Fargate and AWS Lambda as well. Because the discount follows the workload rather than a fixed configuration, Compute Savings Plans suit organizations that expect to modernize or shift workloads during the term.

Why the others are wrong

  • B — There is no resale marketplace for Savings Plans. A limited resale mechanism exists for certain Reserved Instances, not for Savings Plans.
  • C — Being locked to one instance family and Region describes EC2 Instance Savings Plans, which trade that narrower scope for a deeper discount of up to 72%.
  • D — No Savings Plan reserves capacity. Capacity assurance in a specific Availability Zone comes from zonal Reserved Instances or On-Demand Capacity Reservations.

Last verified: 2026-09-01

Question 12 clf-billing-basics-012

Intermediate · Choose one

Which statement correctly distinguishes Amazon EC2 Dedicated Hosts from Dedicated Instances?

  1. a Dedicated Hosts are billed per running instance, whereas Dedicated Instances are billed as a flat charge for the physical server
  2. b Dedicated Instances expose sockets, cores, and host ID, whereas Dedicated Hosts only guarantee that no other AWS account shares the hardware
  3. c Both options provide host affinity and targeted instance placement, and they differ only in price
  4. d Dedicated Hosts expose sockets, cores, and host ID and support per-socket, per-core, and per-VM license models, whereas Dedicated Instances run on single-tenant hardware but provide no visibility into the underlying physical server
Show answer & explanation

Answer: D

Why D is correct

Both options give single-tenant hardware, but only Dedicated Hosts expose the physical server's sockets, cores, and host ID. That visibility is what allows customers to bring licenses that are counted per socket, per core, or per VM. Dedicated Hosts are billed per host and add host affinity and targeted instance placement. Dedicated Instances are billed per instance, support a narrower set of BYOL scenarios such as SQL Server with License Mobility, and offer no placement control.

Why the others are wrong

  • A — This reverses the billing models. Dedicated Hosts carry a per-host charge; Dedicated Instances carry a per-instance charge plus a per-Region fee for dedicated tenancy.
  • B — This reverses the two. Dedicated Instances are the option that provides isolation without hardware visibility.
  • C — Host affinity and targeted instance placement are Dedicated Hosts features only. Dedicated Instances do not support them, so price is not the only difference.

Last verified: 2026-09-01

Question 13 clf-billing-basics-013

Intermediate · Select 2 answers

Which TWO statements accurately describe Amazon EC2 Spot Instances? (Choose TWO.)

  1. a The price agreed at launch is locked for the life of the instance
  2. b They use spare Amazon EC2 capacity and can save up to 90% compared with On-Demand pricing
  3. c AWS can reclaim the capacity, giving the instance a two-minute interruption notice
  4. d They require a 1-year or 3-year commitment before the discount applies
  5. e They reserve capacity in a chosen Availability Zone for the duration of the workload
Show answer & explanation

Answer: B and C

Why B and C are correct

Spot Instances draw on unused Amazon EC2 capacity, which is why AWS can price them at up to 90% below On-Demand. The price of that discount is reclaimability: when AWS needs the capacity for On-Demand or committed-use customers, it interrupts the Spot Instance after a two-minute warning. Understanding both halves together, deep discount and interruptibility, is what lets a candidate decide whether a workload belongs on Spot.

Why the others are wrong

  • A — Spot prices adjust gradually based on supply and demand for spare capacity, so the rate is not fixed for the life of the instance.
  • D — Spot requires no term commitment at all. Commitments of 1 or 3 years belong to Reserved Instances and Savings Plans.
  • E — Reserving capacity in a specific Availability Zone is the function of a zonal Reserved Instance or an On-Demand Capacity Reservation. Spot provides the opposite: capacity that AWS may take back.

Last verified: 2026-09-01

Question 14 clf-billing-basics-014

Hard · Choose one

A company must guarantee that Amazon EC2 capacity will be available in one specific Availability Zone for a three-week regulatory reporting event. It is unwilling to enter a 1-year or 3-year commitment. What should it use?

  1. a Spot Instances launched with a capacity-optimized allocation strategy
  2. b An On-Demand Capacity Reservation in that Availability Zone
  3. c A one-year Compute Savings Plan sized to the event's expected usage
  4. d A one-year zonal Standard Reserved Instance
Show answer & explanation

Answer: B

Why B is correct

On-Demand Capacity Reservations reserve EC2 capacity in a specific Availability Zone for as long as the customer needs it, with no term commitment, and can be cancelled when the event ends. The reservation is billed at On-Demand rates whether or not instances are actually running in it, which is the cost of holding guaranteed capacity. This decoupling of capacity assurance from a long-term billing commitment is exactly the gap the feature fills.

Why the others are wrong

  • A — A capacity-optimized allocation strategy reduces the likelihood of Spot interruption but cannot guarantee capacity, since AWS reclaims Spot capacity when it is needed elsewhere.
  • C — A Compute Savings Plan is a billing construct only. It provides no capacity assurance in any Availability Zone, and it also imposes the one-year commitment the company wants to avoid.
  • D — A zonal Reserved Instance would reserve the capacity, but it locks the company into a one-year term for a three-week need, so the company would pay for roughly eleven months of unused commitment.

Last verified: 2026-09-01

Question 15 clf-billing-basics-015

Hard · Choose one

Which statement about Amazon EC2 Standard and Convertible Reserved Instances is correct?

  1. a Convertible Reserved Instances offer a larger discount but cannot be exchanged, while Standard Reserved Instances offer a smaller discount and can be exchanged freely
  2. b Standard Reserved Instances offer a larger discount but cannot be exchanged, while Convertible Reserved Instances offer a smaller discount but can be exchanged for reservations with different attributes of equal or greater value
  3. c Both types can be exchanged for reservations with different attributes, and they differ only in the available term lengths
  4. d Neither type can be modified after purchase, so the instance family, size, and Availability Zone are fixed for the whole term
Show answer & explanation

Answer: B

Why B is correct

The Standard and Convertible split is a trade of discount depth against flexibility. Standard reservations give the deepest Reserved Instance discount, and while they can be modified in limited ways such as changing the Availability Zone or scope, AWS documentation states they cannot be exchanged. Convertible reservations accept a smaller discount in return for the right to exchange into a reservation with different attributes, provided the new reservation is of equal or greater value.

Why the others are wrong

  • A — This reverses both halves of the trade-off. Convertible reservations are the flexible, less deeply discounted option.
  • C — Standard Reserved Instances cannot be exchanged, and both types offer the same 1-year and 3-year terms, so term length is not the distinguishing factor.
  • D — Reserved Instances can be modified within documented limits: changing the Availability Zone within the Region, changing the scope between zonal and regional, and changing instance size within the same instance family and generation.

Last verified: 2026-09-01