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Company A has a beta of 0.90, while Company B's beta is 1.70. The required return on the stock market is 9.00%, and the risk-free

Company A has a beta of 0.90, while Company B's beta is 1.70. The required return on the stock market is 9.00%, and the risk-free rate is 2.25%. 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.) Do not round your intermediate calculations.

a. 7.200%
b. 3.600%
c. 5.400%
d. 8.325%
e. 11.025%

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