3. Annual effective interest rate. Francia Inc., is shopping for a P80 million financing to support its working capital requirements. The following data were gathered from several local banks with respect to interest terms, compensating balances, and other matters: 5% Bank 1 Bank 2 Bank 3 Bank 4 Bank 5 Nominal interest rat2% discounted not discourigunot discounte, discouritta discounted Interest payment Annually Annually Annually Annually Annually Compensating 1% 0.5% None 1.5% Balance Present compensating none none P1.2 million P2 million P1.2 million balance Interest income on incremental 7% 5% none compensating balance Net interest expense Net proceeds Annual effective interest rate Compounded annual EIR none none Required: a. Complete the table above and determine the effective interest rates for each of the lending banks. Which bank offers the most economical interest costs? What is Bank I's effective interest rate if the interest payment is made on a monthly basis? 3. Annual effective interest rate. Francia Inc., is shopping for a P80 million financing to support its working capital requirements. The following data were gathered from several local banks with respect to interest terms, compensating balances, and other matters: 5% Bank 1 Bank 2 Bank 3 Bank 4 Bank 5 Nominal interest rat2% discounted not discourigunot discounte, discouritta discounted Interest payment Annually Annually Annually Annually Annually Compensating 1% 0.5% None 1.5% Balance Present compensating none none P1.2 million P2 million P1.2 million balance Interest income on incremental 7% 5% none compensating balance Net interest expense Net proceeds Annual effective interest rate Compounded annual EIR none none Required: a. Complete the table above and determine the effective interest rates for each of the lending banks. Which bank offers the most economical interest costs? What is Bank I's effective interest rate if the interest payment is made on a monthly basis