1 The amazon cloud machine at start will be empty so you will have to install everything
2 For question 4
If you host a cloud in your own premises for your own use, then I guess this would be a private cloud ? Why have such an arrangement instead of simply locating some servers on your LAN / WAN ?
Reason a person wll go for cloud one is suppose you want to host your application as trial for users . Thats one scenario Like the product is running 24 hours
and you don't have to worry about electricity charges, And idea is you are getting your computer or server on hire..
5 For question number 5 i use it for running hosted applications. The server runs 24 hours..