3. (Factoring) Your firm has an average collection period of 31 days. Current practice is to factor all receivables immediately at a discount of 1.25 percent. What is the effective cost of borrowing EAR in this case? 4. (Compensating B annually up to $25 million. In addition, the bank requires you to compensating balance against the amount you borrowed. Wh on this line of credit? Bank offers your firm a line of credit at 8.25% In addition, the bank requires you to maintain a 5% e against the amount you borrowed. What is the effective interest rate