Question: 1. a) Consider a stock that has a standard deviation of 14.2% and the correlation with the market is 0.65. The standard deviation of the

1. a)

Consider a stock that has a standard deviation of 14.2% and the correlation with the market is 0.65. The standard deviation of the market is 12.8%. What is the beta of the stock? Enter your answer rounded to 2 DECIMAL PLACES.

b)

Given a risk-free rate of 1.6%, a market risk premium of 13.4%, and a beta of 1.48, what is the expected return of the stock? Enter your answer as a percentage and rounded to 2 DECIMAL PLACES. Do not put the percent sign in your answer.

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