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Hi There

The $47.18 from scenario 1 is just an example. Its based on the discounted rate that you get when you purchase a savings plan. It works like this:

- You have an EC2 instance that costs $1/hour to run on-demand
- The discounted rate for this instance is $.90/hour when you purchase a savings plan for 1 year. This is the discount you get for committing to 1 year of usage.
- You purchase a savings plan commitment of $.90/hour which will cover the entire cost of running that instance.
- If you spin up a second instance of the same type, you are billed $1.90/hour. ($.90/hour for the savings plan + $1/hour the on demand rate for the second instance)
- If you terminate both instances, you are still billed $.90/hour because you committed to that amount for the year.

Check out this youtube video for a good explanation of how savings plans work: https://www.youtube.com/watch?v=xjq-1CdvgQ8

HI Matt. I think I forgot to thank you. To add a little more information to the answer below is the Total Calculation

Let’s break down the calculation for the total cost of $47.13 in the example scenario:

**r5.4xlarge Linux Instances:**

- On-Demand rate: $1.00 per hour
- Savings Plans rate: $0.70 per hour (30% off On-Demand)
- You have 4 instances running for the full hour. Total cost with Savings Plans: $0.70 × 4 = $2.80

**Fargate vCPUs:**

- On-Demand rate: $0.04 per vCPU per hour
- Savings Plans rate: $0.03 per vCPU per hour (25% off On-Demand)
- You have 400 vCPUs in usage. Total cost with Savings Plans: $0.03 × 400 = $12.00

**m5.24xlarge Windows Instance:**

- On-Demand rate: $10.00 per hour
- Savings Plans rate: $8.20 per hour (18% off On-Demand)
- You have 1 instance running for the full hour. Total cost with Savings Plans: $8.20

**AWS Lambda:**

- Lambda duration (per GB/sec):
- On-Demand rate: $0.000015 per GB/sec
- Savings Plans rate: $0.00001275 per GB/sec (15% off On-Demand)
- You have 1,600 GB-seconds of usage. Total cost with Savings Plans: $0.00001275 × 1,600 = $20.40

**Lambda requests (per 1M requests):**

- On-Demand rate: $0.20 per 1M requests
- Savings Plans rate: $0.20 per 1M requests (0% off On-Demand)
- You have 1 million requests. Total cost with Savings Plans: $0.20

**Overall Total Cost:**
Adding up all the individual costs:
$2.80 (r5.4xlarge Linux) + $12.00 (Fargate vCPUs) + $8.20 (m5.24xlarge Windows) + $20.40 (Lambda duration) + $0.20 (Lambda requests) = $43.60

The total cost is less than your $50.00/hour commitment, so it covers your usage.

The remaining commitment not used: $50.00 - $43.60 = $6.40

Therefore, the total cost considering the commitment is $43.60 + $6.40 = $47.13.

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