Which Amazon EC2 Instance to use?

I want to setup a proxy (using Squid) that will take ~ 5000 requests per day on an Amazon EC2 instance. Will there be a noticeable difference in speed between a micro vs small instance?

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Micro instances main issue is spotty CPU and disk I/O performance, but that amount of traffic is actually quite small, averaging 3 requests a minute. As a bonus, a micro instance will qualify for Amazon's free tier. For optimal performance, make sure the machine is stripped down of unnecessary services.

I would advice you to start with ebs (not instance-store) micro instance. Later you will be able to convert micro to small.

Besides if you are planing to use the instance during for long time (more than one year) just think about purchasing reserved instance (you will save some money). But before you reserve instance you must definitely know what is better for you micro or small.

Good luck!

A micro instance should be able to handle that kind of traffic as long as you don't have too many other things installed on it. Since you are only charged for how long the instance is running. I would take both a micro and a small instance and then run some tests to see if the micro can handle your traffic or if the small instance gives you better performance and is worth the extra cash.