Holding transaction costs, taxation and other factors constant, which of the following banks will provide better interest on a short-term deposit if all banks offer 6% on $50 million which is needed in 3 months time.

Exhibit 5 - Bank Interest Calculation Methods Practice Day Count in Period Days/Year Bank 1 Exact Number of Days 360 Bank 2 Exact Number of Days 365 Bank 3 Assumed 30 Days/Month 360 Days Used 28 28 30