Your friends were excited to hear you have chosen accounting for a career. They have several practical questions regarding money and interest (time value of money). Please assist your friends by answering their respective questions.

For each question:

1. Estimatewithout using a text table, business calculator, or EXCEL formula functions, etc.
2. Document the "step-by-step" detail showing them how you solved the question.

NOTE: To solve use one of the following:

• EXCEL formula functions => i.e.=pmt(rate,nper,pv,[fv],[type])
• Business calculator
• Text tables (not recommended).

Include all the detail steps for whichever tool you choose.For example, if using EXCEL show all formulas (copy so reader could duplicate your work). If using a business calculator, in detail in proper order show numbers and buttons you input to obtain your answer.

1. Provide a one to three sentence written explanation to your friend explaining the basic time value of money concept(s) impacting the solution.

Problems start with "Friend #1" at the top of page 2.

Q1. Friend #1 - Car Loan -What will by my monthly payment if I purchase a used car for $8,500? The dealer has offered to finance the purchase (car loan) over four years at 5%. No down payment is required.