Ahab's Army Surplus Has a Committed Line of Credit with a Maximum

Multiple Choice

Ahab's Army Surplus has a committed line of credit with a maximum of $1.2 million and interest rate of 3.5% (EAR) .The loan has a commitment fee of 0.45% (EAR) .If the firm borrows $900,000 at the start of the year and repays it at the end of the year,what is the total cost of the loan?

A) $42,000
B) $35,550
C) $43,350
D) $32,850
E) $31,500