1. A person is interested in buying a new car. They believe they could afford to make monthly loan payments, at the end of each month, of no more than $650 / month for 40 months at a monthly interest rate 1% per month. What would be the amount of the loan (hint: Present Value) that the bank would be willing to make to that person?

b) What would be the total amount paid to the bank over the 40 months?

c) How much interest will the bank earn over the 40 month period?

d) In addition to the amount that this person can borrow from the bank, they believe they can also afford to make a down payment of $5,000 from their savings account at the time the car is purchased. What would be the maximum price for a new car that this person could plan on buying?