if for an application, amazon ec2 instance and amazon RDS instance be on two different Avalability Zone/Region, how much performance degradation are expected?
It's always best to serve as much content in the same zone that way the hops between servers is much greater. If host both the RDS and EC2 in the same zone/region then the traffic is internal and therefor SUPERFAST.
If you host RDS in one Region and EC2 in another then they are having to talk to one another from a much larger distance therefor the response time (MS) will increase. Now it's hard to predict what increases you can expect and you will need to do this yourself via SSH in the EC2 instance.
Simply Login to your EC2 instance and run the ping command and ping the RDS instance that is hosted in the other region - It will report the delay in MS. Then test it locally. I'd imagine that locally its around 5ms or lower and region to region is something like 100ms (10th of a sec). Bare in mind when HUBS and ROUTES go down these increase as well as congestion on the network - So for a better estimate you'd need to setup a ping and run it once every 30mins for 24 hours and then work out the average, and thats your approx increase in time from using a RDS in a different region than the EC2.
I'm not sure why you would want to host the RDS in another region, maybe because you have another server prehaps and you want to share the instance, personally you'd be better of running each in their own region but if you want to know the exact increase well thats how you can find out.
What your find is the response time between your EC2 and RDS with be higher
It is going to vary wildly. Mostly, you are going to need to track the maintenance and downtime schedules for two zones, and you'll lose a lot of in-region pricing discounts on bandwidth.