Answer: Reserved Instances

## Explanation **Reserved Instances** are the most cost-effective option for this scenario because: - **Long-term commitment**: The company needs the server to stay active for 12 months, which aligns perfectly with the 1-year commitment period of Reserved Instances - **Significant cost savings**: Reserved Instances offer up to 75% discount compared to On-Demand pricing when you commit to a 1-year term - **Guaranteed capacity**: Unlike Spot Instances, Reserved Instances provide guaranteed availability for the entire duration - **Predictable billing**: The company can budget accurately for the entire 12-month period **Why other options are less cost-effective**: - **On-Demand**: Most expensive option with no discounts for long-term usage - **Dedicated Hosts**: More expensive physical servers dedicated to a single customer, not cost-effective for this use case - **Spot Instances**: Cheapest option but can be terminated at any time, which violates the requirement for the server to "stay active at all times" Since the workload requires continuous availability for a predictable 12-month period, Reserved Instances provide the optimal balance of cost savings and reliability.

Author: Ritesh Yadav