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Company A has a beta of 0.70, while Company B's beta is 1.20. The required return on the stock market is 9.00%, and the risk-free

  1. Company A has a beta of 0.70, while Company B's beta is 1.20. The required return on the stock market is 9.00%, and the risk-free rate is 2.00%. What is the difference between A's and B's required rates of return?

    A.

    3.50%
    B.

    1.50%
    C.

    4.50%
    D.

    2.50%

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