Estimated parameters of the Characteristic Line/single index model (R = alpha + beta RM) of the shares of companies A and B are in the table. Random components have been omitted. If the rate of return on shares of company A is twice as high as the rate of return on shares of company B, then the market portfolio rate of return is equal:

company a: 4.8% alpha parameter, 0.7 beta parameter

company b: 1% alpha parameter, 1.2 beta parameter

Select the correct answer:

1. 1.6%

2. 2%

3. 2.9%

4. 3.5%