FEDERAL bank offers an interest of 5% per annum compounded annually on all its deposits. If $10,000 is deposited, what will be the ratio of the interest earned in the 4th year to the interest earned in the 5th year?  Choose the correct choice from the following options.
A) 1:5  B) 625:3125  C) 100:105  D) 100^4:105^4  E) 725:3225
Hi Bunuel,   Here is my approach: is this correct?   FEDERAL bank offers an interest of 5% per annum compounded annually on all its deposits   Interest earned in 4 year= 10000(1+0.05)^4   Interest earned in 5 year= 10000(1+0.05)^5   Ratio= {10000(1.05)^4}/{10000(1.05^5)} =&gt;1.05^4/1.05^5 =&gt;1/1.05 Multiplied by 100 in both numerator and denominator gives 100:105   Hence Ans:100:105
<result>C</result>
FEDERAL bank offers an interest of 5% per annum compounded annually on all its deposits. If $10,000 is deposited, what will be the ratio of the interest earned in the 4th year to the interest earned in the 5th year?