Your company wants to borrow 5 million dollars for one month. You are head of the short-term investments of your company and must make a decision which is the best offer. What is the best offer and why?

a. Line of credit at 6.5% with a 12% commitment fee.

b. A bankers acceptance at 6.75%, all inclusive rate.

c. Commercial paper at 6.15% with a dealers commission of 1/8% and a backup line cost of 14%, both of which would be assessed on the $5 million of commercial paper issued.