CompTIA CLO-002 Exam With Confidence Using Practice Dumps

Capital expenditures are costs that a business incurs to acquire or improve long-term assets that will provide benefits beyond the current year. Capital expenditures are also known as PP&E, which stands for Property, Plant, and Equipment. Capital expenditures are usually one-time purchases of fixed assets that have a high initial cost and a long useful life. Capital expenditures are recorded as assets on the balance sheet and depreciated over time12

Data center wiring and server purchases are examples of capital expenditures, because they are part of the physical infrastructure that supports the IT operations of a business. Data center wiring and server purchases have a high upfront cost and a long lifespan, and they provide benefits for several years. Data center wiring and server purchases are also recorded as assets on the balance sheet and depreciated over time34

Cloud consultant fees, data center electric bill, spot instances, and disposable virtual machines are not examples of capital expenditures, but rather operating expenses. Operating expenses are costs that a business incurs to run its day-to-day operations and generate revenue. Operating expenses are also known as OPEX, which stands for Operating Expenses. Operating expenses are usually recurring payments for variable or consumable resources that have a low cost and a short useful life. Operating expenses are recorded as expenses on the income statement and deducted from revenue to calculate profit12

Cloud consultant fees are operating expenses, because they are payments for professional services that help a business implement or optimize its cloud strategy. Cloud consultant fees are recurring payments that vary depending on the scope and duration of the project, and they do not result in the acquisition or improvement of any long-term assets. Cloud consultant fees are also recorded as expenses on the income statement and deducted from revenue to calculate profit5

Data center electric bill is an operating expense, because it is a payment for the utility service that powers the data center equipment. Data center electric bill is a recurring payment that varies depending on the consumption and the rate of electricity, and it does not result in the acquisition or improvement of any long-term assets. Data center electric bill is also recorded as an expense on the income statement and deducted from revenue to calculate profit.

Spot instances and disposable virtual machines are operating expenses, because they are payments for cloud computing resources that are available on-demand and for a short duration. Spot instances and disposable virtual machines are recurring payments that vary depending on the usage and the market price of the resources, and they do not result in the acquisition or improvement of any long-term assets. Spot instances and disposable virtual machines are also recorded as expenses on the income statement and deducted from revenue to calculate profit.

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Avoidance is a risk response strategy that involves eliminating the threat or uncertainty associated with a risk by removing the cause or the source of the risk. Avoidance can help to prevent the occurrence or the impact of a negative risk, but it may also result in the loss of potential opportunities or benefits. Avoidance is usually applied when the risk is too high or too costly to mitigate, transfer, or accept12

The business analyst is using the avoidance strategy by decommissioning the server that has a vulnerability. By doing so, the analyst is eliminating the possibility of the vulnerability being exploited or causing harm to the system or the data. However, the analyst is also losing the functionality or the value that the server provides, and may need to find an alternative solution or resource.

Mitigation is not the correct answer, because mitigation is a risk response strategy that involves reducing the probability or the impact of a negative risk by implementing actions or controls that can minimize or counteract the risk. Mitigation can help to lower the exposure or the severity of a risk, but it does not eliminate the risk completely. Mitigation is usually applied when the risk is moderate or manageable, and the cost of mitigation is justified by the potential benefit12

Transference is not the correct answer, because transference is a risk response strategy that involves shifting the responsibility or the impact of a negative risk to a third party, such as a vendor, a partner, or an insurer. Transference can help to share or distribute the risk, but it does not reduce or remove the risk. Transference is usually applied when the risk is beyond the control or the expertise of the organization, and the cost of transference is acceptable or affordable12

Acceptance is not the correct answer, because acceptance is a risk response strategy that involves acknowledging the existence or the possibility of a negative risk, and being prepared to deal with the consequences if the risk occurs. Acceptance can be passive, which means no action is taken to address the risk, or active, which means a contingency plan or a reserve is established to handle the risk. Acceptance is usually applied when the risk is low or inevitable, and the cost of avoidance, mitigation, or transference is higher than the cost of acceptance12

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 Vendor lock-in is the type of risk that is most likely to be associated with moving all data to one cloud provider. Vendor lock-in refers to the situation where a customer is dependent on a particular vendor’s products and services to such an extent that switching to another vendor becomes difficult, time-consuming, or expensive. Vendor lock-in can limit the customer’s flexibility, choice, and control over their cloud environment, and expose them to potential issues such as price increases, service degradation, security breaches, or compliance violations. Vendor lock-in can also prevent the customer from taking advantage of new technologies, innovations, or opportunities offered by other vendors. Vendor lock-in can be caused by various factors, such as proprietary formats, standards, or protocols, lack of interoperability or compatibility, contractual obligations or penalties, or high switching costs12

References: CompTIA Cloud Essentials+ Certification Exam Objectives3, CompTIA Cloud Essentials+ Study Guide, Chapter 2: Business Principles of Cloud Environments2, Moving All Data to One Cloud Provider: Understanding Risks1