Question: question help In exchange for a $600 million xed commitment line of credit. your rm has agreed to do the following: 1. Pay 2.0% per

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In exchange for a $600 million xed commitment line of credit. your rm has agreed to do the following: 1. Pay 2.0% per quarter on any funds actually borrowed. 2. Maintain a 5% compensating balance on any funds actually borrowed. 3. Pay an up-front commitment fee of 0.190% of the amount of the line. Based on this information, answer the following: a. Ignoring the commitment fee. what is the effective annual interest rate on this line of credit? [Do not round intermediate calculations. Round the nal answer to 2 decimal places.) Effective annual interest rate 9; b. Suppose your rm immediately uses $100 million of the line and pays it off in one year. What is the effective annual interest rate oI this $100 million loan? (Do not round intermediate calculations. Round the nal answer to 2 decimal places.) Effective annual interest rate 9

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