3. Your client is trying to compare two loan contracts. She wishes to borrow $15,000 over the next 5 years and make monthly payments. Loan 1 South West Bank is offering a loan at 10% p.a. compounded monthly over five years. (a) What are the monthly payments on this loan? (b) What is the effective annual rate? Loan 2 Local Credit Company has told your client that the monthly payments she will make are $311.20. However, Local Credit Company has not revealed the interest rate it used to calculate this payment. Local Credit Company did state that all loans are calculated using monthly compounding. (a) What is the annual nominal interest rate on this loan? (b) What is the effective annual rate? Which loan should your client choose, and why