On July 1, 2011, Sam Confrey received a five year, $50,000 loan from his employer. The loan was intended to assist Sam with the purchase of a home in his new employment location. The new home is 47 kilometers closer to Sam's new work location. The interest rate on the loan was 3 percent. Assume that during the third and fourth quarters of 2011, the relevant prescribed rate of interest is 4 percent. The effect of this transaction on his Taxable Income would be:
a) An increase of $250.
b) An increase of $500.
c) An increase of $750.
d) An increase of $2,000.
e) No change.