Company A has a beta of 0.70, while Company B's beta is 1.00. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.)

Select the correct answer.

a. 1.82%

b. 1.89%

c. 1.96%

d. 2.10%