$4-$ Consider the following table, which gives a security analyst's expected return on two stocks

for two particular market returns:

a$.$ What are the betas of the two stocks?

$b.$ What is the expected rate of return on each stock if the market return is equally likely to

be $5\%$ or $25\%?$

c$.$ If the T$-$bill rate is $6\%$ and the market return is equally likely to be $5\%$ or $25\%,$ draw

the SML for this economy.

d$.$ Plot the two securities on the SML graph. What are the alphas of each?

e$.$ What hurdle rate should be used by the management of the aggressive firm for a project

with the risk characteristics of the defensive firm's stock?