1.a) You own a portfolio equally invested in a risk-free asset and two stocks. One of the stocks has a beta of 1.26 and the total portfolio is equally as risky as the market. What must the beta be for the other stock in your portfolio?

1.b) A stock has an expected return of 17.8 percent, the risk-free rate is 5.1 percent, and the market risk premium is 8.4 percent. What must the beta of this stock be?