Per Amazon White Paper:

Recovery time objective (RTO) -- How long does it take to recover after an outage?  The time it takes after a disruption / outage to restore a business process to normal service levels.  For example, if a outage occurs at 8AM and the RTO is 2 hours, the DR process should restore the business process to the acceptable service level by 10:00 AM.

Recovery point objective (RPO) -- How much data can you afford to lose IN TIME?  The acceptable amount of data loss measured in time.  For example, if a disaster
occurs at 8AM and the RPO is 5 minutes, the system should recover all data that was in the system before
07:55AM.  Acceptable data loss be for the 5 minute period, between 07:55AM and 08:00AM.

Normally, the shorter the RTO, and RPO the more money it costs.  Costs in the cloud are generally much less than on-premise for both RTO and RPO especially with some built-in RDS solutions within the same region and the same can be said for RTO and RPO times.

Note: restores from automated backups (and manual) are S3 snapshots – restoration is to a new database and does not overwrite the existing database.

References:

https://media.amazonwebservices.com/AWS_Disaster_Recovery.pdf

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