AWS offers several purchasing options to optimize costs based on workload requirements, predictability, and flexibility. Choosing the right model depends on whether you have steady-state, interruptible, or specific hardware-isolation needs.

EC2 Purchasing Options

1
On-Demand: Pay by the second for compute capacity; no long-term commitment.
2
Reserved Instances: Provide capacity reservation and discounts for 1 or 3-year commitments.
3
Savings Plans: Offer lower prices for a commitment to a consistent amount of compute usage ($/hour).
4
Spot Instances: Utilize unused EC2 capacity at significant discounts (up to 90%) but are interruptible.
5
Dedicated Hosts: Physical servers fully dedicated to your account for compliance or BYOL requirements.
6
Dedicated Instances: Instances running in a VPC on hardware dedicated to a single customer.

Difficulty: 5/10

Topics: On-Demand vs Reserved, Spot Instances, Savings Plans

Scenario Questions

0-2 years experience

1
You need to spin up a web server for a short demo that will run for a few hours. Which EC2 purchasing option would you choose and why?
2
If a developer asks you to reduce the cost of a constantly running test environment that must be available 24/7, what EC2 purchase model would you recommend and what steps would you take to implement it?

2-5 years experience

1
Your team migrated a batch processing job to EC2 and noticed the cost doubled after a month. How would you investigate whether a different purchasing option could lower the cost, and what trade‑offs would you consider?
2
During a scaling event, you see Spot Instance interruptions causing job failures. How would you redesign the workload to keep costs low while handling Spot interruptions?

5-8 years experience

1
Design a cost‑optimisation strategy for a microservices platform that runs 100+ instances continuously, balancing Reserved Instances, Savings Plans, and Spot Instances. What factors drive your allocation and how do you monitor usage?
2
Explain how you would incorporate Capacity Reservations and Dedicated Hosts into a compliance‑driven architecture that requires specific tenancy, while still controlling spend.

8+ years experience

1
Your organization plans to migrate legacy workloads from on‑prem to AWS over the next three years. How would you create a long‑term EC2 purchasing roadmap that aligns with financial forecasting, multi‑account governance, and evolving workload patterns?
2
Across several product teams, there is disagreement on using Savings Plans vs Reserved Instances for a shared fleet. How would you establish a cross‑team policy and tooling to ensure optimal purchasing decisions at scale?

Follow-up Questions

❓What metrics would you monitor to decide when to shift between purchase options?
❓How would you handle a sudden traffic spike if you were primarily using Spot Instances?
❓Can you share a pitfall you’ve seen teams encounter with Reserved Instances sizing?