The manager of ELF Company is forced to choose one from these three alternative bank loans. The firm wishes to select the one that minimizes its cost of credit on a RM 200,000 loan. Relevant information for the three loans configuration is as follows: i. ii. 18% rate of interest paid at the end of the loan period and no compensating balance requirement 18% rate of interest and 20% compensating balance requirement. This loan also called for interest to be paid at the end of the loan period. iii. 18% rate of interest that is discounted plus a 20% compensating balance requirement. Analyze the cost of each alternative. You may assume the firm would not maintain any bank balance that might be used to meet the 20% compensating balance requirement. Which alternative should ELF Company choose or go for? Powere Sunny Berhad plans a commercial paper issue of RM 20 million. The commercial paper will carry 270 days of maturity and will require interest based on a rate of 11% per annum. In addition, the firm will have to pay fees totaling of RM 200,000 in order to bring the commercial paper to market. What is the effective cost of the commercial paper issue to Sunny Berhad? (Show all the calculations) QUESTION 3 QUESTION S CoCo Industries plans to sell RM 200 million in 250-day-maturity paper on which the expected discounted interest is 10% per annum. The firm also expects to incur RM 200,000 in dealer placement fees and other expenses of issuing the paper. What is the effective cost of issuing the commercial paper?