Mathematics for IGCSE & O level - Percentages (Section 2 - No. 27)

What is the difference between simple and compound interest on an investment of $4000 for 2 years at 5% per annum?

$10

$20

$50

If $4000 is invested with simple interest 5% for two years it would yield $400 which is the same as compound interest for the 2 year duration.