4. Assume that there are two factors that price assets. Risk free rate is 3%. Factor 1 has an expected return of 7% and factor 2 has an expected return of 9%. Calculate the expected return for each asset with the following sensitivities using the Arbitrage Pricing Theory (APT):

(a) 1 = 1, 2 = 0.8;

(b) 1 = 1.2, 2 = 0.50;

(c) 1 = 0.8, 2 = 1.5.