The Treadwater Bank wants to raise $1,000,000 using three-month commercial paper. The net proceeds to the bank will be $989,000. What is the effective annual rate of this financing for Treadwater? Magna Corporation has an issue of commercial paper with a face value of $1,000,000 and a maturity of six months. Magna received net proceeds of $970,523 when it sold the paper. What is the effective annual rate of the paper to Magna? Assume that the prime rate is 8.4% APR, compounded quarterly. How much dollar savings in interest did Treadwater and Magna achieve by accessing the commercial paper market?

The effective annual rate of this financing for Treadwater is____________ (Round to two decimal places.)