Cloud Economics: Trading Fixed for Variable Expenses
Short answer
D The company benefits from trading fixed expense for variable expense by paying only for the computing resources it actually uses.
Question
Key Takeaways
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.
Common mistake: Candidates often confuse this with speed and agility (Option B), failing to distinguish between operational efficiency metrics and financial cost structures.
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
https://docs.aws.amazon.com/whitepapers/latest/aws-overview/six-advantages-of-cloud-computing.html
This link opens the official vendor documentation in a new tab.
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?
What is the difference between CapEx and OpEx in AWS?
Community Votes
100% of anonymous learners picked answer D. Votes are pick records left by other test-takers — they are not the verified answer.
Discussion 3 contributions
Compiled from public community threads and reader submissions, lightly edited for clarity. Handles and vote tallies are shown as recorded, and comments reflect the views of individual contributors.
From public community threads 3
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blasdelezo 👍 1 Answered DThe 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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ShaiTay 👍 1 Answered DD. Trade fixed expense for variable expense
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komorebi 👍 1 Answered DAnswer is D
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