CLF-C02 Billing, Pricing, and Support Practice Question
A company currently pays $50,000/month for on-premises infrastructure. They project that running the equivalent workload on AWS will cost $35,000/month including all data transfer. What is the annual AWS cost savings?
⚠ Common exam trap
Watch out — candidates often confuse monthly savings with annual savings, or mistakenly calculate the annual cost of one environment instead of the difference, leading them to pick Option A, C, or D.
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
✓
$180,000
The monthly cost savings are $50,000 - $35,000 = $15,000. Annualizing this gives $15,000 × 12 = $180,000. Option B is correct because it correctly multiplies the monthly savings by 12 to compute the annual savings.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$15,000
Why it's wrong here
The $15,000 figure represents the monthly cost difference between the on-premises environment ($50,000) and the AWS environment ($35,000). This is the correct monthly savings, but the question specifically asks for annual savings, so you must multiply the monthly savings by 12 months. Failing to perform this multiplication yields the monthly value, not the requested annual total, making this answer incorrect.
- ✓
$180,000
Why this is correct
To compute annual savings, calculate the monthly difference as $50,000 - $35,000 = $15,000 saved per month by migrating to AWS. Then extrapolate that monthly savings over a full year: $15,000 × 12 = $180,000. This correctly answers the question because cost savings accumulate monthly, and the annual figure directly reflects the total reduction in infrastructure spending over a 12-month period.
- ✗
$420,000
Why it's wrong here
The $420,000 value equals $35,000 per month multiplied by 12 months, which is the total annual cost of running the workload on AWS. While this is a legitimate calculation, it answers a different question: the total AWS spend, not the savings relative to the existing on-premises setup. Savings are determined by the difference between the two environments' costs, not the lower environment's total cost alone.
- ✗
$600,000
Why it's wrong here
The $600,000 value is obtained by multiplying the current on-premises monthly cost of $50,000 by 12 months, giving the total annual on-premises expenditure. However, this represents the baseline cost you would incur without migrating, not the savings achieved. To find savings, you must subtract the AWS alternative from this baseline on-premises cost; simply quoting the on-premises total ignores the offset from AWS costs entirely.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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.