Multiple choice

Directions: Select the correct alternative from the given choices. Two business partners, A and B, invested their capitals in the ratio of 2 : 3 respectively, with their periods of investment not being equal. If they shared the year-end profit in the ratio of 1 : 2 respectively, what is the ratio of their respective periods of investment?

  1. 3 : 4

  2. 4 : 3

  3. 2 : 1

  4. 1 : 4
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A Correct answer
Explanation

Profit = Investment * Time. Let capital ratio be C1:C2 = 2:3 and time ratio be T1:T2 = x:y. Profit ratio P1:P2 = 1:2. So (2*x)/(3*y) = 1/2. 4x = 3y, so x/y = 3/4.

AI explanation

The profit ratio is the product of the investment ratio and the time ratio. Thus, the time ratio equals the profit ratio divided by the investment ratio, which is (1/2) : (2/3). Multiplying both sides by 6 gives a time ratio of 3 : 4.

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