A market index portfolio has a required return of 9%, while the risk-free return is 3.5%. The market index portfolio has a standard deviation of 20%. Bluebird Inc. stock has a covariance of 0.06 with the market index portfolio and a standard deviation of 50%.

a. Calculate the equity or stock Beta of Bluebird.

b. Calculate the required return of Bluebird stock using the CAPM.

c. The market risk premium is going to remain unchanged, but the risk-free rate will rise from 3.5% to 4.0%. Calculate the new required return for Bluebird common stock.