Cloud Economics: Trading Fixed for Variable Expenses

Answer Correct answer: D — The company benefits from trading fixed expense for variable expense by paying only for the computing resources it actually uses.

A company migrated to the AWS Cloud. Now the company pays for services on an as-needed basis. Which advantage of cloud computing is the company benefiting from?

  1. Stop spending money running and maintaining data centers
  2. Increase speed and agility
  3. Go global in minutes
  4. Trade fixed expense for variable expense Correct Answer

Community Votes

D
100%

100% of anonymous learners picked answer D. Votes are pick records left by other test-takers — they are not the verified answer.

Community Insight

The scenario describes paying for services on an as-needed basis, which directly maps to the concept of trading fixed infrastructure costs for variable usage-based expenses.

This question explores the core benefit of cloud economics by contrasting traditional capital expenditure with modern operational spending models.

Candidates often confuse this with speed and agility (Option B), failing to distinguish between operational efficiency metrics and financial cost structures.

Community Discussion (3 comments)

ShaiTay 👍 1 Selected: D
D. Trade fixed expense for variable expense
komorebi 👍 1 Selected: D
Answer is D
blasdelezo 👍 1 Selected: D
The four answer are advantages of cloud computing but only one is pay for services: Trade fixed expense for variable expense – Instead of having to invest heavily in data centers and servers before you know how you’re going to use them, you can pay only when you consume computing resources, and pay only for how much you consume. https://docs.aws.amazon.com/whitepapers/latest/aws-overview/six-advantages-of-cloud-computing.html

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Expert Analysis

Why the Answer Is Correct

The correct answer is D because the scenario explicitly describes a payment model based on consumption ('as-needed basis'). In cloud computing economics, this represents the shift from Capital Expenditure (CapEx) to Operational Expenditure (OpEx). Instead of investing heavily in physical hardware upfront (fixed expense), the company now pays only for the resources it consumes (variable expense).

Why the Other Options Are Wrong

Options A, B, and C are all valid benefits of cloud computing, but they do not describe the specific financial mechanism mentioned in the prompt. Option A refers to avoiding data center maintenance; Option B refers to rapid deployment and development speed; and Option C refers to global reach and latency reduction. None of these options address the change in how money is spent.

Community Comment Notes

The community consensus strongly supports Option D. As noted by user blasdelezo, the key distinction lies in the definition of paying 'only when you consume computing resources,' which aligns perfectly with the trade-off between fixed and variable expenses found in AWS whitepapers.

Official Reference

Exam Strategy

When analyzing cloud advantage questions, carefully distinguish between technical benefits (speed, availability) and economic benefits (cost models). If the question mentions 'pay-as-you-go', 'subscription', or 'no upfront cost', look for keywords related to CapEx vs. OpEx or variable expenses.

Frequently Asked Questions

Why is "Increase speed and agility" incorrect here?

Speed and agility refer to how fast you can deploy applications. The question specifically asks about the financial aspect of paying for services as needed.

What is the difference between CapEx and OpEx in AWS?

CapEx is upfront investment in physical hardware (fixed expense). OpEx is paying for services as you use them (variable expense), which is the primary model in the cloud.

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