Complete the Equal-Payments Three-Year Amortization Table

question 101

Essay

Complete the equal-payments three-year amortization table. $$\begin{array} { | c | c | c | c | c | c | } \hline \text { Year } & \begin{array} { c } \text { Beginning } \\\text { Principal }\end{array} & \text { Payment } & \begin{array} { c } \text { Interest } \\\text { Expense }\end{array} & \begin{array} { c } \text { Principal } \\\text { Reduction }\end{array} & \begin{array} { c } \text { Ending } \\\text { Principal }\end{array} \\\hline 1 & \$ 6,000.00 & & \$ 480.00 & & \$ 4,151.80 \\\hline 2 & & \$ 2,328.20 & & \$ 1,996.06 & \\\hline 3 & \$ 2,155.74 & & & & \\\hline\end{array}$$

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Definitions:

Standard Deviation

A statistical measure of the dispersion or variability of a set of data points, often used in finance to quantify the risk of an investment.

Risk Aversion

The preference of investors to avoid risk, leading them to invest in safer securities with lower potential returns.

Optimal Risky Portfolio

A collection of financial investments that has the highest expected return for a given level of risk.

Risk-Free Asset

An investment with a guaranteed return, with no risk of financial loss, typically represented by government bonds.