Given the following Adjustable Rate Mortgage (ARM): Loan amount: $100,000 Term: 20 years, monthly payment Discount point and fee: $8,000 Teaser rate: 7.5% Margin: 225 basis points Rate caps: Market Index: 2.5% annually, 6% lifetime. EOY 1 2 Index 8.6% 3 4 5 9.5% 10.5% 11.5% 10.5% What is the effective cost of this loan if you pay it off at the end of year 2? 13.32% 8.68% O 10.33% 12.05%