What will be the simple to compound interest (compounded annually) ratio on two identical funds put in a bank at an interest rate of 8% (per annum) for three years?

Answer: Option B

Solution

Answer: Option B

Solution:

$$8\%=\frac{2}{25}$$

$$\text{Simple Interest}=\frac{15625\times 8\times 3}{100}=3750$$
\begin{array}{*{20}{c}} \Rightarrow &{{\text{Simple Interest}}}&:&{{\text{Compound Interest}}} \\ {}&{3750}&:&{4058} \\ {}&{1875}&:&{2029} \end{array}