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What is the main benefit of Reserved Instances compared to On-Demand Instances?

easy📝 Conceptual Q2 of 15
AWS - EC2 Fundamentals
What is the main benefit of Reserved Instances compared to On-Demand Instances?
ALower hourly cost with a commitment
BAbility to stop and start anytime without cost
CAccess to the newest instance types only
DNo upfront payment required
Step-by-Step Solution
Solution:
  1. Step 1: Understand Reserved Instances

    Reserved Instances require a commitment (1 or 3 years) and offer a lower hourly rate.
  2. Step 2: Compare with On-Demand features

    On-Demand has no commitment but higher cost; Reserved saves money by committing upfront.
  3. Final Answer:

    Lower hourly cost with a commitment -> Option A
  4. Quick Check:

    Reserved = cheaper with commitment [OK]
Quick Trick: Reserved = pay less by committing upfront [OK]
Common Mistakes:
MISTAKES
  • Thinking Reserved has no commitment
  • Confusing with On-Demand flexibility
  • Believing Reserved has no upfront cost

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