CLF-C02 Cloud Concepts Practice Question
A company is calculating the Total Cost of Ownership (TCO) for migrating to AWS vs. staying on-premises. Which costs are typically REDUCED when migrating to AWS?
⚠ Common exam trap
CLF-C02 often tests the misconception that all costs decrease in the cloud, but the exam expects you to recognize that data transfer and licensing can increase, and that only physical infrastructure and management costs are typically reduced.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Physical hardware, data center facilities, and infrastructure management costs
Migrating to AWS shifts capital expenditures (CapEx) like physical servers, storage, and networking hardware to operational expenditures (OpEx) because AWS owns and maintains the infrastructure. This eliminates costs for data center facilities (power, cooling, real estate) and reduces the operational burden of infrastructure management (patching, racking, hardware failures). Thus, option B correctly identifies the primary cost categories that decrease.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Software licensing costs always decrease when moving to AWS
Why it's wrong here
Software licensing costs are not automatically reduced on AWS; bringing existing on-premises enterprise licenses (BYOL) requires careful review of license mobility, and some software vendors require dedicated hosts or specific AWS offerings to remain compliant. Commercial agreements such as Microsoft or Oracle licenses often have specific rules for shared tenancy, and migrations may force re-architecting or purchasing new licensing models from the AWS Marketplace. As a result, licensing costs can stay flat or even rise, so the statement that they 'always decrease' is factually incorrect.
- ✓
Physical hardware, data center facilities, and infrastructure management costs
Why this is correct
AWS operates hyper-scale data centers that replace a customer's on-premises physical hardware, facility space, power and cooling, and the staffing overhead required to rack, stack, and maintain servers. By migrating, customers shift from large capital expenditures (Capex) for hardware procurement to variable operational expenses (Opex) based on consumption, and AWS's massive procurement volume lowers per-unit infrastructure costs. This is the primary financial benefit of cloud, because customers no longer pay for idle capacity or the full lifecycle cost of their own physical data center equipment.
- ✗
Developer salaries and application development costs
Why it's wrong here
Developer compensation and application engineering efforts remain after migration because AWS does not write, deploy, or maintain a customer's application code; the customer still needs a full software engineering team to build, test, and iterate on business logic. In many cases, teams require additional training and AWS certification to acquire cloud-specific skills, which can raise short-term costs instead of eliminating them. This option is incorrect because it represents human capital and application development expenses, which are not part of the physical infrastructure costs AWS replaces.
- ✗
Data transfer costs are eliminated in the cloud
Why it's wrong here
AWS does not eliminate data transfer costs; inbound data into AWS is generally free, but outbound (egress) traffic to the internet is billed per gigabyte, and inter-VPC or cross-region traffic can also incur charges. While on-premises networks may bundle internal traffic costs into hardware and WAN contracts, cloud users see egress as a discrete line item, so the cost may appear new rather than disappear. Therefore, claiming that data transfer costs are eliminated in the cloud is false because AWS explicitly prices network traffic and charges customers based on usage.
Quick reference
AWS S3 Storage Class Comparison
| Storage Class | Min Duration | Retrieval | Use Case |
|---|---|---|---|
| S3 Standard | None | Immediate | Frequently accessed data |
| S3 Standard-IA | 30 days | Immediate | Infrequent access, rapid retrieval |
| S3 One Zone-IA | 30 days | Immediate | Non-critical infrequent data |
| S3 Intelligent-Tiering | None | Immediate–hours | Unknown or changing access patterns |
| S3 Glacier Instant | 90 days | Milliseconds | Archive with instant retrieval |
| S3 Glacier Flexible | 90 days | Minutes–hours | Archive, flexible retrieval |
| S3 Glacier Deep Archive | 180 days | Hours | Long-term compliance archive |
Go deeper
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Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official Amazon Web Services exam blueprint
This CLF-C02 practice question is part of Courseiva's free Amazon Web Services certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CLF-C02 exam.