- A
On-Demand instances require a minimum commitment of one month
Why wrong: On-Demand has no minimum commitment — Linux instances are billed per-second (minimum 60 seconds), with no monthly commitment.
- B
On-Demand instances are billed per second with no upfront commitment or termination fees
Linux EC2 On-Demand instances are billed by the second with a 60-second minimum — no upfront fees, no long-term commitment, and no termination charges.
- C
On-Demand instances are the cheapest pricing option for all workloads
Why wrong: On-Demand is not the cheapest option — Reserved Instances, Savings Plans, and Spot Instances offer significant discounts in exchange for commitment or interruptibility.
- D
On-Demand instances must be running continuously once launched
Why wrong: On-Demand instances can be stopped and started at any time — billing stops when the instance is stopped (though EBS storage charges continue).
Quick Answer
The answer is that Amazon EC2 On-Demand instances are billed per second with no upfront commitment or termination fees. This pricing model is correct because it charges for compute capacity by the second, with a minimum of 60 seconds for Linux instances, and by the hour for other operating systems, while requiring no long-term contract or penalty for stopping or terminating an instance. On the AWS Certified Cloud Practitioner CLF-C02 exam, this concept tests your understanding of the flexibility and cost predictability of On-Demand pricing, often appearing in questions that contrast it with Reserved or Spot Instances. A common trap is assuming On-Demand requires a minimum hourly charge for all OS types, but remember that Linux instances enjoy per-second billing after the first minute. For a quick memory tip, think “On-Demand = On-the-Second, No Strings Attached” to recall the per-second billing and zero upfront or termination fees.
CLF-C02 Billing, Pricing, and Support Practice Question
This CLF-C02 practice question tests your understanding of billing, pricing, and support. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
Which statement about Amazon EC2 On-Demand pricing is accurate?
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
On-Demand instances are billed per second with no upfront commitment or termination fees
Amazon EC2 On-Demand instances are billed per second (with a minimum of 60 seconds) for Linux instances, and per hour for other operating systems, with no upfront payment or termination fees. This model provides maximum flexibility, allowing you to launch and stop instances as needed without any long-term commitment or penalty.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
On-Demand instances require a minimum commitment of one month
Why it's wrong here
On-Demand has no minimum commitment — Linux instances are billed per-second (minimum 60 seconds), with no monthly commitment.
- ✓
On-Demand instances are billed per second with no upfront commitment or termination fees
Why this is correct
Linux EC2 On-Demand instances are billed by the second with a 60-second minimum — no upfront fees, no long-term commitment, and no termination charges.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
On-Demand instances are the cheapest pricing option for all workloads
Why it's wrong here
On-Demand is not the cheapest option — Reserved Instances, Savings Plans, and Spot Instances offer significant discounts in exchange for commitment or interruptibility.
- ✗
On-Demand instances must be running continuously once launched
Why it's wrong here
On-Demand instances can be stopped and started at any time — billing stops when the instance is stopped (though EBS storage charges continue).
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often assume On-Demand instances require a minimum commitment (like one month) or that they must run continuously, confusing them with Reserved Instances or forgetting the per-second billing flexibility for Linux instances.
Detailed technical explanation
How to think about this question
Under the hood, EC2 On-Demand pricing leverages AWS's metering infrastructure that tracks instance runtime in one-second increments (for Linux) after a 60-second minimum, enabling granular billing. This per-second billing is particularly cost-effective for short-lived tasks like batch processing or development/testing, where stopping an instance after a few minutes avoids paying for a full hour. In contrast, Reserved Instances require a 1- or 3-year commitment to achieve lower rates, highlighting the trade-off between flexibility and cost savings.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A startup's cloud architect reviews their monthly bill and notices costs are higher than expected for a long-running batch job. Switching from on-demand instances to Reserved Instances — or using Spot/Preemptible VMs — can reduce compute costs by up to 72 %. Questions like this test whether you understand the tradeoffs between commitment, flexibility, and cost across cloud pricing models.
What to study next
Got this wrong? Here's your next step.
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FAQ
Questions learners often ask
What does this CLF-C02 question test?
Billing, Pricing, and Support — This question tests Billing, Pricing, and Support — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: On-Demand instances are billed per second with no upfront commitment or termination fees — Amazon EC2 On-Demand instances are billed per second (with a minimum of 60 seconds) for Linux instances, and per hour for other operating systems, with no upfront payment or termination fees. This model provides maximum flexibility, allowing you to launch and stop instances as needed without any long-term commitment or penalty.
What should I do if I get this CLF-C02 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
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Last reviewed: Jun 11, 2026
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.
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