Statement 1: On a certain sum, at the same rate of interest and for the same time period, compound interest is always greater than the simple interest.

Statement 2: In compound interest, the principal remains constant for the whole time period, however the compound interest keeps increasing every year.

Which of the following options is correct?

1. Both the statements are true.

2. Both the statements are false.

3. Statement 1 is true, and statement 2 is false.

4. Statement 1 is false, and statement 2 is true.

Assertion (A) : The simple interest on a certain sum is $\dfrac{9}{16}$ of the principal. If the number representing the rate of interest in percent and the time in year are equal then the time for which the principle is lent out is $7\dfrac{1}{2}$ years.

Reason (R) : In simple interest,

Time = $\dfrac{\text{S.I.} \times 100}{\text{\text{Principal}} \times \text{Rate}}$.

1. Both A and R are correct, and R is the correct explanation for A.

2. Both A and R are correct, and R is not the correct explanation for A.

3. A is true, but R is false.

4. A is false, but R is true.

Assertion (A): Compound interest for the 2^nd year on ₹ 8,000 at 5% p.a. is ₹ 820.

Reason (R): Compound interest for 2 years = Amount at the end of 2^nd year - original sum.

1. Both A and R are correct, and R is the correct explanation for A.

2. Both A and R are correct, and R is not the correct explanation for A.

3. A is true, but R is false.

4. A is false, but R is true.

Assertion (A) : On ₹ 8,750 at 8% p.a., the simple interest for 1^st year is equal to the simple interest for 4^th year.

Reason (R) : Simple interest for 4^th year = Amount at the end of 4^th year - original sum.

1. Both A and R are correct, and R is the correct explanation for A.

2. Both A and R are correct, and R is not the correct explanation for A.

3. A is true, but R is false.

4. A is false, but R is true.