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06. Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 2.5% + 0.6012,, + an R3 = -1.5% + 0.703., + a, a... = 19%; Rsquarea = 0.24; Rsqua.::eB = 0.18 What are the covariance and correlation Writ between the two stocks? (Do not round intermediate calculations. Calculate using numbers in decimal form, not percentages. Round your answers to 4 decimal places.) 07. Suppose that the index model for stocks A and B is estimated from excess returns with the following results: R\" = 5.0% + 1.311,, + e'.I R3 = '2.0% + 1.6R + as on = 20%; R-square'. = 0.20; .Rsqua.z.'e13 = 0.12 What is the covariance between each stock and the market index? (Calculate using numbers in decimal form, not percentages. Do not round your intermediate calculations. Round your answers to 3 decimal places.) 08. A stock recently has been estimated to have a beta of 1.12: a. What will a beta book compute as the \"adjusted beta\" of this stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. Suppose that you estimate the following regression describing the evolution of beta over time: t = 0-4 + O'Sptl What would be your predicted beta for next year? (Do not round intermediate calculations. Round your answer to 3 decimal places.)