In exchange for a $3 million fixed commitment line of credit, a firm has agreed to the following conditions:

• 0.5% monthly interest will be paid on any funds actually borrowed
• 7% compensating balance will be maintained on any funds actually borrowed
• 0.2% of up-front commitment fee will be paid based on the amount of the line.

If the firm immediately borrows $1,000,000 from the line to use for 1 year, what would be EAR on this borrowed amount? Note that the commitment fee will be paid on the fixed commitment line of credit amount ($3 million).