CLF-C02 Question 39
Single answerA startup is evaluating its IT infrastructure costs. They are considering moving from an on-premises data center to AWS. One of the key factors in their decision is understanding the difference between fixed costs and variable costs. Which of the following describes how AWS helps reduce fixed costs and leverage variable costs?
- A
AWS allows you to pay only for the resources you consume, avoiding large upfront investments in hardware.
- B
AWS requires you to purchase and maintain physical servers, contributing to higher fixed costs.
- C
AWS provides a fixed monthly subscription fee, regardless of usage, to help manage costs.
- D
AWS offers tools like Auto Scaling to adjust resource usage based on demand, enabling variable cost optimization.
Show answer and explanation
Correct answer: A
Explanation
AWS helps businesses reduce fixed costs by eliminating the need for upfront hardware investments typical in on-premises infrastructure. Instead, AWS follows a pay-as-you-go model, which aligns costs with actual resource usage, turning them into variable costs. This model allows businesses to scale resources up or down based on demand, optimizing expenditure and avoiding over-provisioning.
- A. Correct.
This is correct because AWS operates on a pay-as-you-go model, which eliminates the need for large upfront investments (fixed costs) and enables businesses to scale their costs based on actual usage (variable costs).
- B. Incorrect.
This is incorrect because AWS eliminates the need for purchasing and maintaining physical servers, which are part of fixed costs in traditional on-premises setups.
- C. Incorrect.
This is incorrect because AWS does not operate on a fixed monthly subscription fee model; costs are based on usage, which is variable.
- D. Incorrect.
This is incorrect because while AWS offers tools like Auto Scaling, this option does not directly explain how AWS reduces fixed costs and leverages variable costs.