(a)Jack is considering investing in the stocks. The two stocks are available with the following particulars:

Stock Return %Beta Marvel 9.60.75DC8.71.3

As measured by the return on government stock, a risk-free return in the market is 3.6%.Using capital asset pricing model, Calculate:

(i) The rate of return of stock Marvel

(Ii) The rate of return of stock DC

(iii) Which stock should Jack invest in and why?

(b) Explain the advantages and limitations of capital asset pricing model