A project under consideration has an internal rate of return of 16% and a beta of 0.6. The risk-free rate is 6%, and the expected rate of return on the market portfolio is 16%.

a-1. Calculate the required return.

Required return _______%

a-2. Should the project be accepted?

Yes No

b-1. Calculate the required return if its beta is 1.6.

Required return _______%

b-2. Should the project be accepted?

Yes No