Question

Luke loaned $3500 to his sister. His sister agreed to repay Luke in a year, with 2% simple interest on the $3500. What is the total amount that Luke's sister will repay?

Answer 1

$3,570

Explanation:

Simple interest = principal × rate × time / 100

Principal = $3,500

Rate = 2%

Time = 1 year

Simple interest = principal × rate × time / 100

= (3500 × 2 × 1) / 100

= 7000 / 100

= 70

Simple interest = $70

Total amount that Luke's sister will repay = principal + simple interest

= $3,500 + $70

= $3,570

Total amount that Luke's sister will repay = $3,570