What is the purpose of setting up alarms in Amazon CloudWatch?

Setting up alarms in Amazon CloudWatch serves the primary purpose of monitoring resource usage and performance. CloudWatch provides a comprehensive monitoring solution that allows users to track metrics for various AWS services in real-time. By establishing alarms based on specific thresholds for these metrics, users can receive notifications when resource utilization or performance levels reach a defined limit, enabling proactive management of resources.

For example, if the CPU usage of an Amazon EC2 instance exceeds a certain percentage, an alarm can trigger to alert the administrator to investigate the instance's performance. This capability is crucial for maintaining optimal performance, ensuring that resources are not under or over-utilized, and enabling automatic scaling decisions as needed.

In contrast, creating backup copies of data is managed through services like Amazon S3 or AWS Backup, while configuring security settings is typically done through AWS Identity and Access Management (IAM) and various security service tools. Managing accounts involves financial and billing management through the AWS Management Console rather than monitoring performance metrics. Thus, the primary function of CloudWatch alarms is to facilitate effective monitoring and response to resource usage and performance indicators.