A$-$Call Enterprises has two divisions: R&D Technologies $($assets of $$2$ million; beta of $1\mathrm{.}5)$ and Steel $($assets of $$8$ million; beta of $0\mathrm{.}75).$ The firm finances its operations through $$4$ million in bonds $($with an expected return of $7\%)$ and $$6$ million in equity.

$($a$)$ What are the beta and the expected return on the firm's equity? Assume a risk$-$free rate of $3\%$ and a market risk premium of $8\%.(10)$

$($b$)$ Comment on the suitability of the firm's capital structure.