A bank is offering 3 loan options. Which of the following is the best option. Prove your answer.

Option 1: A loan of P50,000 at 8 % simple interest to be paid at the end of 5 years.

Option 2: A loan of P50,000 at 6.5% advance interest to be deducted from the proceeds and to be paid at the end of 5 years.

Option 3: A loan of P50,000 to be paid monthly for 5 years paying P1650 per month.