- A
AWS Budgets
This is correct. AWS Budgets allows you to set custom cost and usage budgets and configure alerts based on actual or forecasted spending. You can centrally manage budgets from the management account when using AWS Organizations.
- B
AWS Cost Explorer
Why wrong: This is incorrect. AWS Cost Explorer provides a visual interface to explore and analyze your AWS costs and usage, but it does not send proactive budget alerts. It is a reporting and visualization tool, not a budget alerting service.
- C
AWS Trusted Advisor
Why wrong: This is incorrect. AWS Trusted Advisor inspects your environment and makes recommendations for cost optimization, performance, security, and fault tolerance. It does not allow you to set budget thresholds or send email alerts when spending exceeds a predefined amount.
- D
AWS Organizations
Why wrong: This is incorrect. AWS Organizations is used to centrally manage multiple AWS accounts, apply service control policies (SCPs), and consolidate billing. It does not provide budget alerting or notification capabilities.
CLF-C02 Billing, Pricing, and Support Practice Question
This CLF-C02 practice question tests your understanding of billing, pricing, and support. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. 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.
A company has multiple AWS accounts managed through AWS Organizations. The finance team wants to set a monthly cost budget of $5,000 for the 'Project Alpha' account. They want to receive an email notification when the actual costs reach 80% of the budget and again when the forecasted costs are expected to exceed the budget. The team also needs to centrally manage these budgets from the management account. Which AWS service should the team use to meet these requirements?
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
AWS Budgets
AWS Budgets allows you to set custom cost and usage budgets, and configure threshold-based alerts via Amazon SNS (email or other notifications). In this scenario, the finance team can create a monthly cost budget of $5,000 for the 'Project Alpha' account, then set an alert at 80% of actual costs and another alert when forecasted costs are expected to exceed the budget. Because the company uses AWS Organizations, budgets can be centrally managed from the management account, enabling the finance team to view and control budgets across member accounts without logging into each one individually.
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.
- ✓
AWS Budgets
Why this is correct
This is correct. AWS Budgets allows you to set custom cost and usage budgets and configure alerts based on actual or forecasted spending. You can centrally manage budgets from the management account when using AWS Organizations.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
AWS Cost Explorer
Why it's wrong here
This is incorrect. AWS Cost Explorer provides a visual interface to explore and analyze your AWS costs and usage, but it does not send proactive budget alerts. It is a reporting and visualization tool, not a budget alerting service.
- ✗
AWS Trusted Advisor
Why it's wrong here
This is incorrect. AWS Trusted Advisor inspects your environment and makes recommendations for cost optimization, performance, security, and fault tolerance. It does not allow you to set budget thresholds or send email alerts when spending exceeds a predefined amount.
- ✗
AWS Organizations
Why it's wrong here
This is incorrect. AWS Organizations is used to centrally manage multiple AWS accounts, apply service control policies (SCPs), and consolidate billing. It does not provide budget alerting or notification capabilities.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse AWS Cost Explorer's forecasting capability with the ability to set proactive alerts, but Cost Explorer only displays forecasts and does not send notifications when forecasted costs exceed a threshold.
Detailed technical explanation
How to think about this question
AWS Budgets integrates with AWS Organizations to allow the management account to create budgets that apply to individual member accounts or the entire organization, using the `budgets:ViewBudget` and `budgets:ModifyBudget` permissions. When a budget threshold is exceeded, AWS Budgets publishes a message to an Amazon SNS topic, which can then trigger an email, SMS, or Lambda function. The forecasted cost alert uses AWS Cost Management's forecasting engine, which applies machine learning models to historical usage patterns to predict future spend, and the alert fires when the forecasted cost exceeds the budgeted amount, not just the actual cost.
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: AWS Budgets — AWS Budgets allows you to set custom cost and usage budgets, and configure threshold-based alerts via Amazon SNS (email or other notifications). In this scenario, the finance team can create a monthly cost budget of $5,000 for the 'Project Alpha' account, then set an alert at 80% of actual costs and another alert when forecasted costs are expected to exceed the budget. Because the company uses AWS Organizations, budgets can be centrally managed from the management account, enabling the finance team to view and control budgets across member accounts without logging into each one individually.
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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