Lloyd Blankfein would like to supplement his low pension paid by his employer Goldman Sacks. His personal banker Jamie Dimon told him that he could pay $1,000 every month for ten years (making 10 × 12 = 120 payments at the end of each month until her retirement) and then he will start receiving $1,000 forever. He will receive the first $1,000 in ten years and one month, i.e. one month after he made his last payment; after he passes away his heirs (and their heirs etc.) will continue to receive the monthly payments forever. What is the effective annual rate (EAR) the bank used to calculate the terms of this deal?

Show all work please

Step by step

Does not use excel please?

Explain the question with words not just numbers