What type of cloud instance is purchased at lower rates for unused capacity?

A Spot instance is a type of cloud instance that is offered at significantly lower rates compared to other types of instances, such as on-demand instances. These lower prices are made possible because Spot instances utilize unused cloud capacity. This means that when a cloud provider has excess computing resources that are not being utilized, they offer these resources to users at a reduced cost.

The key advantage of Spot instances is their cost-effectiveness for workloads that are flexible in terms of when they can run. Users can save a substantial amount of money for applications that do not require guaranteed availability at all times. However, it's important to note that since these instances rely on unused capacity, there is a risk that they can be interrupted or terminated by the cloud provider if demand for resources increases. This characteristic makes Spot instances appealing for non-critical applications or batch processing tasks that can tolerate interruptions.

In contrast, reserved instances involve a commitment to use a certain amount of capacity for a specified period, which offers cost savings compared to on-demand instances, but they do not directly tap into excess capacity like Spot instances. Dedicated instances provide isolated hardware for compliance or performance reasons and typically come at a higher cost. On-demand instances are billed based on actual usage with no long-term commitment, providing flexibility but usually