Assume that both portfolios A and B are well diversified, that E(r_A) = 12%, and E(r_B) = 9%. If the economy has only one factor, and _A = 1.2, whereas _B = 0.8, what must be the risk-free rate and the risk premium on the factor?

Group of answer choices

3%;4.5%

3%;7.5%

2%;5%

1.5%;6%;