1. Company A has a beta of 0.80, while Company B's beta is 1.50. The required return on the stock market is 12.00%, and the risk-free rate is 5%. What is the difference between A's and B's required rates of return?

a. 2.2%

b. 2.8%

c. 3.5%

d. 3.9%

e. 4.9%