The compound interest on a certain sum at the end of two years is Rs.408. The simple interest on the same sum for the same time is Rs.400. The rate of interest per annum is:

2% 80% 40% 8%

2%

Simple interest of 2 years = 400 Compound interest of 2 years = 408 Difference b/w CI and SI = 408 - 400 = 8 Simple interest of 1 year = \(\frac{400}{2}\) = 200 Rate of interest = \(\frac{8}{200}\) × 100% = 4%