This SOA-C02 practice question tests your understanding of cost and performance optimization. Match the stated requirement to the specific cloud service, access model, or configuration option — many options are valid in isolation but not for this scenario. 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 wants to receive alerts when its AWS costs exceed a certain threshold. Which AWS service should be used?
Amazon CloudWatch
Why wrong: Monitors resource metrics, not cost thresholds natively.
AWS Cost Explorer
Why wrong: Visualizes costs, but does not send alerts.
AWS Trusted Advisor
Why wrong: Provides cost optimization checks, but not budget alerts.
AWS Budgets
Allows setting cost budgets and sending alerts.
Answer choices
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 receive alerts when actual or forecasted costs exceed a defined threshold. It directly supports cost-based alerting with actions such as sending an SNS notification or applying an IAM policy to restrict resources when the budget limit is breached.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
Amazon CloudWatch
Why it's wrong here
Monitors resource metrics, not cost thresholds natively.
AWS Cost Explorer
Why it's wrong here
Visualizes costs, but does not send alerts.
AWS Trusted Advisor
Why it's wrong here
Provides cost optimization checks, but not budget alerts.
AWS Budgets
Why this is correct
Allows setting cost budgets and sending alerts.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
The trap here is that candidates confuse AWS Budgets with AWS Cost Explorer, assuming Cost Explorer can send alerts, when in fact Cost Explorer is only a reporting and analysis tool without native alerting capabilities.
Detailed technical explanation
AWS Budgets integrates with Amazon SNS to send notifications via email, SMS, or HTTP endpoints when actual or forecasted costs exceed budget thresholds. Under the hood, budgets are evaluated every 6–12 hours, and you can define up to 50 budget alerts per account, with support for RI and Savings Plans utilization tracking. In a real-world scenario, a company might set a monthly cost budget of $10,000 with an alert at 80% and 100% to trigger an SNS topic that invokes a Lambda function to automatically stop non-critical EC2 instances.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
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
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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FAQ
Cost and Performance Optimization — This question tests Cost and Performance Optimization — Read the scenario before looking for a memorised answer..
The correct answer is: AWS Budgets — AWS Budgets allows you to set custom cost and usage budgets and receive alerts when actual or forecasted costs exceed a defined threshold. It directly supports cost-based alerting with actions such as sending an SNS notification or applying an IAM policy to restrict resources when the budget limit is breached.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 24, 2026
This SOA-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 SOA-C02 exam.
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