1. If a stock has a be ta coeffi cient equal to 1.50, the ri sk pre mium associated with the m arket is 10 percent, and the ris k-free rate is 4 perc ent, appl ication of the capit al asset pri cing mod el indicat es the app ropriate return should be?

2. If th e risk-fr ee rate is 6 perc ent, the expect ed return on the m arket is 12 percent, a nd the requir ed rate of ret urn on Secur ity X is 15 per cent, what is th e be ta of Security X?