Question: Suppose you observe the following situation: Security Beta Expected Return Peat Co. 1.20 10.6 Re-Peat Co. .80 9.3 Assume these securities are correctly priced. Based

Suppose you observe the following situation:

Security	Beta	Expected Return
Peat Co.	1.20	10.6
Re-Peat Co.	.80	9.3

Assume these securities are correctly priced. Based on the CAPM, what is the expected return on the market? What is the risk-free rate?(Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)


Expected return	%
Risk-free rate	%

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