$(8)$ XYZ multinational company has $55$ foreign orders from customer abroad. On average, each order costs $$12,000.$ XYZ is considering the following three alternatives with connection to the expected credit risk of customers:

$($a$)$ To ask for LC $($letter of credit$)$ from each customer. In this case, the cost to each customer$/$order becomes $$65+0\mathrm{.}25\%$ of the commercial invoice amount. XYZ has to cover the cost of the LC so as to remain competitive.

$($b$)$ To factor $($discount$)$ the account receivables. In this case, the factoring firm charges $2\%$ of nonrecourse fee.

$($c$)$ To buy insurance against customers' credit risk which costs $1\%$ of the commercial invoice amount.

Which of these alternatives is better, why?