(a) (12 points) Consider the CAPM model regression results for stock A and stock B: RA - Rf = -1% +0.8(RM - Rf), where RA is the return of stock A, RM is the return of the market, and Rf is the risk-free return. We are also told that the regression for stock A yielded R-square = 0.351 and Residual standard deviation = 15.4%. RB - Rf = 3% + 1.4(RM - Rf), where RB is the return of stock B, and RM, Rf defined as before. We are also told that the regression for stock B yielded R-square = 0.459 and Residual standard deviation = 7.5%. Answer briefly the following questions: i) Which stock has more firm-specific risk? ii) Which stock has greater market risk? iii) For which stock does market movement explain a greater fraction of return volatility