PLEASE HELP! I will like answer! The security market line is estimated to be

k=7% + (11.9% - 7%)B.

You are considering two stocks. The beta of A is 1.6. The firm offers a dividend yield during the year of 3 percent and a growth rate of 7.5 percent. The beta of B is 2.1. The firm offers a dividend yield during the year of 4.8 percent and a growth rate of 6.5 percent.

a. What is the required return for each security? Round your answers to two decimal places.

Stock A:

%

Stock B:

%

b. Why are the required rates of return different?

The security market line is estimated to be k=7%+(11.9%7%). You are considering two stocks, The beta of A is 1,6 . The firm offers a dividend vedd during the year of 3 percent and a orowth rate of 7.5 percent, The beta of D is 2.1. The firm offers a dividend vield during the vear of 4.8 percent and a growth rate of 6.5 percent. a. What is the required return for each security? Round vour answers to twe decimal places. stock A: stock B: b. Why are the required rates of return different? The difference in the required rates of return is the result of Stock A or Stock B? C. Since A offers higher potential orowth, should it be purchased? being riskies. Stock A be purchasied. Should or Should not? d. Since A offers higher dividend vield, should it be purchased? Stack A be purchased Should or Should Not? e. Which stock(s) should be purchased? should be purchased