2. You are given the following information from a market in equilibrium: E(RA) = 15.6%; E(RB) = 12.4%; Ba=1.2; BB = 0.8 a. What is the equation of the Security Market Line based on the CAPM? b. What is the equilibrium expected return on a portfolio created from 45% A and 55% B. c. The estimated expected on a stock C is 14%. If the beta of C is 1.3, is C overvalued or undervalued? d. Suppose the risk-free rate goes up by 1% (100 basis points), what will be the new expected return for A? e. If the expected return on the market goes up by 1% (100 basis points) what will be the new expected return for A