Joyce is in the process of negotiating a line of credit with two local banks. The prime rate is currently 9.0%. The terms are as follows: Bank RCCB IBP Loan Terms 1.5% above prime rate on a discounted basis and a 20% compensating balance on the face value of the loan. 2% above prime rate and a 15% compensating balance. a. Calculate the effective interest rate of both banks. Answer: b. Recommend which bank's line of credit Mime Theatrical Supply should accept. Answer: