(Cost of commercial paper) Tri-State Enterprises plans to issue commercial paper for the first time in the firm's 35-year history. The firm plans to issue $500,000 in 270-day maturity notes. The paper will carry a 10.25 percent rate with discounted interest and will cost Tri-State $10,000 (paid in advance) to issue. Note:'Assume a 30-day month and 360-day year.

A. What is the effective cost of credit to tri state?

b. What other factors should the company consider in analyzing whether to issue the commercial paper?

(Cost of commercial paper) TH-State Enterprises plans to issue commercial paper for the first time in the firm's 35-year history. The firm plans to issue $600,000 in 270-day maturity notes. The paper will carry a 10.25 percent rate with discounted interest and will cost TH-State $10,000 (paid in advance) to issue. Note: Assume a 30-day month and 360-day year, a. What is the effective cost of credit to Tri-State? b. What other factors should the company consider in analyzing whether to issue the commercial paper? The effective cost of credit, or APR, to Th-Stato is %. (Round to two decimal places)