In exchange for a $$4$ million fixed commitment line of credit, a firm has agreed to the following conditions:

$0\mathrm{.}6\%$ monthly interest will be paid on any funds actually borrowed

$7\%$ compensating balance will be maintained on any funds actually borrowed

$0\mathrm{.}2\%$ of up$-$front commitment fee will be paid based on the amount of the line.

If the firm immediately borrows $$800,000$ 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 $($ $$4$ million$).($Do not use the $\%$ sign. If your answer is $12\mathrm{.}34\%,$ then enter $12\mathrm{.}34)$

Numeric Response