Question: Please teach me the detailed steps with explanation. Not using excel or professional financial calculators. Thank you very much! Consider the following information about Stocks

Please teach me the detailed steps with explanation. Not using excel

Please teach me the detailed steps with explanation. Not using excel or professional financial calculators. Thank you very much!

Consider the following information about Stocks I and II: State of Economy Recession Normal Irrational exuberance Probability of State of Economy 0.15 0.70 0.15 Rate of Return if State Occurs Stock I Stock II 0.20 -0.25 0.21 0.09 0.06 0.44 The market risk premium is 7 percent, and the risk-free rate is 4 percent. a) Which stock has the most systematic risk? b) Which one has the most unsystematic risk? c) Which stock is "riskier? Explain

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