1. The following three stocks are available in the market: Beta E(R) 12.7% 15% 16.6% 13.9% Stock 1 Stock 2 Stock 3 Stock 4 1.45 1.10 1.55 0.90 Assume the market model is valid: a) Write the market model equation for each stock. b) What is the return on a portfolio with weights of 25 percent in stock 1, 35 percent in stock 2, 20 percent in stock 3, and 20 percent in stock 4? c) Suppose the return on the market is 18 percent, and there are no unsystematic risk surprise in the returns. What is the return on each stock? What is the return on the portfolio