D. RM10 889.07

6. Mak Siti made a loan from Bank Masyarakat for a period of 5 years with an interest rate of 7.5% per annum. If he pays monthly installments of RM237.50, look for Mak Siti's loan money.

To find the loan amount that Mak Siti took from Bank Masyarakat, we can use the formula for the Present Value (PV) of an annuity, which is typically used when we know the monthly payments, interest rate, and loan term.

The formula for the present value of an annuity is:

\[
PV = P \times \left( 1 - (1 + r)^{-n} \right) \div r
\]

Where:
- \( PV \) is the loan amount (what we need to find),
- \( P \) is the monthly payment (RM237.50),
- \( r \) is the monthly interest rate (annual rate divided by 12),
- \( n \) is the total number of payments (loan term in months).

Let's break this down:

1. **Annual interest rate** = 7.5% per annum → Monthly interest rate, \( r = \frac{7.5\%}{12} = \frac{0.075}{12} = 0.00625 \)
2. **Loan term** = 5 years → Total number of monthly payments, \( n = 5 \times 12 = 60 \)

Now, we substitute these values into the formula.

\[
PV = 237.50 \times \frac{1 - (1 + 0.00625)^{-60}}{0.00625}
\]

Let me calculate this for you.The loan amount Mak Siti took from Bank Masyarakat is approximately **RM11,852.51**.

Would you like further details or explanations on any part of this solution?

Here are 5 questions to expand on this topic:
1. How does the monthly interest rate affect the loan amount?
2. What happens if the interest rate changes during the loan period?
3. How would Mak Siti's monthly payments change if she took a longer loan term?
4. Can the same formula be applied for different types of loans like mortgages?
5. What is the total interest paid over the 5 years?

**Tip**: Always review the total repayment amount (monthly payment × number of months) to understand how much interest you are paying over the life of the loan.

Mak Siti made a loan from Bank Masyarakat for a period of 5 years with an interest rate of 7.5% per annum. If she pays monthly installments of RM237.50, look for Mak Siti's loan money.

Discover how to calculate Mak Siti's loan amount from Bank Masyarakat, using a 7.5% annual interest rate and monthly payments of RM237.50 for 5 years. This detailed solution explains the present value of an annuity formula and is suitable for students in Grades 10-12.

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