Mujarab Co. is offered a 3/10 net 40 trade discount by its supplier. In the past, the company has been able to get away with paying for supplies on credit in 60 days. Since it doesn't have money in hand, the company decides to get a loan with Bank Sejahtera. Mujarab Co. needs RM350,000 while the bank needs a 15% compensating balance requirement and RM5,000 interest charges. Mujarab Co. already maintains a RM15,500 balance in the bank. Compute the effective interest rate on the loan and the cost of not taking the discount. Which alternatives should Mujarab choose?