1)

a. Crowley Company's stock has a beta of 1.71, the risk-free rate of interest is 3.8%, and the market average return is 10.5%. What is the rate of return required by owners of the firm's stock? Provide your answer as a decimal . with at least four digits to the right of the decimal (0.1234).

b. A stock has an expected return of 17.41%. The beta of the stock is 0.8 and the risk free rate is 5.99 percent. What is the market risk premium? Express you answer as a decimal , with at least 4 digits to the right of the decimal (0.1234).