The CFO of Startup Company needs to borrow $1 million for one month and is looking at the following options:

1. Drawing down on a line of credit at 7.2% with a % commitment fee on the full amount with no compensating balances.

2. A bankers acceptance at 7.1%, an all-inclusive rate.

3. Commercial paper at 6.9% with a dealers commission of % and a backup line cost of 1/3%, both of which would be assessed on the $1 million of commercial paper issued.

Which one of these forms of borrowing results in the lowest cost of credit? Show your calculations and justifications.