(Rolated to Chockpoint 18.2) (Calculating the cost of short-torm financing) The R. Morin Construcson Compary needs to berrow $100,000 to help finance the cost of a new $150,000 hydraulic crane used in the firm's commercial construction business. The crane will pey for itsest in one yoar, and the firm is considering the following altomatives for financing its purchase: Alternative A. The firm's bank has agreed to lend the $100,000 at a rate of 14 percent. Interest woukd be discounted, and a 15 percent compensating bolance would be required. However, the compensating balance requiroment is not binding on the firm because is nomally maintains a minimum demard deposit (checking account) balance of $25,000 in the bank. Alternative B. The equipment dealer has agreed to firunce the equipment with a 1-year loan. The 5100,000 loan requires payment of principal and interest totaing $117,060. a. Which alternative should Morin select? b. If the bank's compensating.balance requirement had necessitated idle deemand deposits equal to 15 percont of the laan, what eftoct would this have had on the cost of the bank loan alternativa? a. The cost of Alternative A would be Y. (Round to two decimal places.)