What will be ratio of simple to compound interest on two same sums invested in SBP at rate of interest of 8% kept for 3 years?
Q1. What will be ratio of simple to compound interest on two same sums invested in SBP at rate of interest of 8% kept for 3 years?
Answer: 1875/2029
Explanation: SI for 3 years at 8% = 0.24P; CI = P((1.08)³ − 1) ≈ 0.259712P; ratio SI:CI = 2400:2597.12 ≈ 1875:2029.