Answer – A
The AWS Documentation mentions the following on the different instance pricing options
Amazon EC2 provides the following purchasing options to enable you to optimize your costs based on your needs:
On-Demand Instances – Pay, by the second, for the instances that you launch.
Reserved Instances – Purchase, at a significant discount, instances that are always available, for a term from one to three years.
Spot Instances – Request unused EC2 instances, which can lower your Amazon EC2 costs significantly.
Reserved Instances provide you with a significant discount (up to 75%) compared to On-Demand instance pricing. Since there is a commitment to run for a minimum period of three years, going for the "Reserved Instances" would minimise the cost.
On-demand can be used but Reserved Instances are most cost-efficient in the given scenario
Option B is incorrect because Reserved Instances are more effective
Option C is incorrect because in Spot Instances Instance there is no commitment. As soon as the Bid price exceeds the Spot price, a user gets the Instance. In an On-demand Instance, a user has to pay the On-demand rate specified by Amazon. Once they have bought the Instance they have to use it by paying that rate.
In Spot Instance, once the Spot price exceeds the Bid price, Amazon will shut the instance. The benefit to the user is that they will not be charged for the partial hour in which the Instance was taken back from them.
Option D is incorrect because there is nothing like Regular Instances in AWS.
For more information on instance pricing options, please visit the URL
https://docs.aws.amazon.com/AWSEC2/latest/UserGuide/instance-purchasing-options.html