An investment bond is offered to the public at 9% per annum simple interest. Louise buys a bond with a face value of $2,000 that will mature in 2 years. At maturity, how much money in total, including both principal and simple interest, will Louise receive from this bond?

Introduction / Context:
Investment bonds and fixed deposits often pay a fixed simple interest rate on a known face value or principal for a specified term. This problem focuses on calculating both the simple interest and the total maturity amount that the investor receives at the end of the period. Understanding this calculation is essential for comparing different fixed income products and for basic personal finance planning.

Given Data / Assumptions:

Face value or principal of the bond = $2,000
Annual simple interest rate = 9 percent per annum
Term to maturity = 2 years
Interest is calculated using simple interest, not compound interest
No intermediate repayments or reinvestment of interest occur

Concept / Approach:
The main steps are to calculate the simple interest using the formula I = P * R * T and then add this interest to the original principal to obtain the total maturity value. Simple interest means that the interest each year is based only on the original principal, not on accumulated interest. This is different from compound interest where interest is periodically added to principal.

Step-by-Step Solution:
Step 1: Identify the principal P = 2,000 dollars. Step 2: Convert the annual rate R from percent to decimal: 9 percent = 0.09. Step 3: Identify the time T in years, which is 2 years. Step 4: Compute simple interest with I = P * R * T. I = 2,000 * 0.09 * 2. Step 5: Calculate the product: 2,000 * 0.09 = 180 dollars per year. Step 6: Multiply by 2 years: I = 180 * 2 = 360 dollars. Step 7: Add interest to principal to get maturity amount. Maturity amount A = P + I = 2,000 + 360 = 2,360 dollars.

Verification / Alternative check:
A quick check is to compute 9 percent of 2,000 as 0.09 * 2,000 = 180 and then reason that over 2 years of simple interest the investor earns 180 dollars each year. Doubling 180 gives 360 total interest. Adding this to 2,000 again produces 2,360 dollars. This alternative mental method confirms that the calculations are consistent and free from arithmetic errors.

Why Other Options Are Wrong:
Option $3,360 would require an interest of 1,360 dollars on 2,000, which is far more than 9 percent per year for 2 years. Option $4,360 and option $5,360 are even larger and are not compatible with the given rate and term. Only $2,360 is consistent with 9 percent simple interest for 2 years on a principal of 2,000 dollars.

Common Pitfalls:
Learners sometimes confuse simple interest with compound interest and incorrectly apply exponential growth formulas. Others may forget to add the interest back to the principal and instead report only the interest as the final answer. It is also easy to misplace the decimal when converting a percentage to a decimal rate. Always ensure that the rate is written correctly as R over 100, that the time is in years, and that principal plus interest is used for the final maturity value.

Final Answer:
At maturity, Louise receives a total of $2,360 from the bond.