You want to buy a Honda Civic that costs you $15,000. But you have only $5,000 in your savings account, which means you should borrow $10,000 from the Fairfax Honda dealer. The dealer tells you the interest rate of the loan is 12% annually and the loan period is 5 years based on your credit.
1. You need to figure out how much the monthly payment will be if I take the loan of $10,000 from the dealer. You use Goal Seek function in Excel to answer the question.
2. Calculate monthly payment and present value to how much you borrow, also using goal seek.