Consider the following information about Stocks I and II: 7 Rate of Return If State Occurs State of Economy Stock Stock II Probability of State of Economy 20 45 03 - 20 .05 .28 Recession Normal Irrational exuberance .35 .04 38 Book Print erences The market risk premium is 8 percent, and the risk-free rate is 4 percent. (Do not round intermediate calculations. Enter your standard deviation answers as a percent rounded to 2 decimal places, e.g., 32.16. Round your beta answers to 2 decimal places, e.g.. 32.16.) The standard deviation on Stock I's return is deviation on Stock Il's return is stock's systematic risk/beta, Stock percent, and the Stock I beta is percent, and the Stock Il beta is is "riskier" Therefore