PLEASE ANSWER ALL QUESTIONS

You have been assigned the task of estimating the expected returns for three different stocks: QRS, TUV, and wXY. Your preliminary analysis has established the historical risk premiums assoclated with three risk factors that could potentially be included in your calculations: the excess return on a proxy for the market portfolio (MKT), and two variatien capturing general macroeconomic exposures (MACRO1 and MACRO2). These values are: AMkt =7.6%, AmCRO1 =0.3%, and Arecior =0.3%. You have asso estimated the foliswing factor betas (i.e., loadings) for ali three stocks with respect to each of these potential risk factors: a. Calculate expected returns for the three stocks using just the MkT risk factor, Assume a risk-free rate of 5.3%. Round your answers to three decimal places. Expected return for stock QRS: Expected return for stock TUY: Expected return for stock WXY: \& b. Calculate the expected retums for the three stocks using all three risk factors and the same 5.3\% risk.free rate. Round your answers to three decimal places. Expected return for sock Qhs: Expected return for stock TUY: Expected return for stock Wxy c. What soct of exposure might MACRO2 represent? MACRO2 might represent: factor