The National Co. has a revolving line of credit of P300,000 with a one-year maturity. The terms call for 7% interest rate and a 1/2 percent commitment fee on the unused portion of the credit line. The...

The National Co. has a revolving line of credit of P300,000 with a one-year maturity. The terms call for 7% interest rate and a 1/2 percent commitment fee on the unused portion of the credit line. The average loan balance during the year was P100,000. The annual cost of this financing arrangement is.