Yunes’ Yearlings (YY) is able to raise funds by

issuing commercial paper with a face value of

$100,000. If commercial paper is issued, the simple

interest rate would be 5 percent, the time to

maturity would be 90 days, and YY would have

to pay a transaction fee equal to 0.25 percent of

the issue, which would be taken out of the issue

amount. Compute the commercial paper’s APR

and rEAR.