Rockette Dancers requires $0.5 million in financing for a 60-day per,iod. Three alternatives are being considered. Which alternative should be selected?

a. Establish a line of credit with the bank at an interest rate of 14 percent. The bank will require a 10 percent compensating balance.

b. Forgo trade discounts from suppliers on terms of 3/10, net 70.

c. Issue commercial paper for 60 days at a discount of 2.65 percent.