Consider the following information for stocks A$,$ B$,$ and C$.$ The returns on the three stocks are positively correlated, but they are not perfectly correlated. $($That is$,$ each of the correlation coefficients is between $0$ and $1.)$

$\backslash$table$[[$Stock$,$Expected Return,Standard Deviation,Beta$],[$A$,6\mathrm{.}75\%,16\%,0\mathrm{.}9],[$B$,7\mathrm{.}50,16,1\mathrm{.}2],[$C$,8\mathrm{.}50,16,1\mathrm{.}6]]$

Fund $P$ has one$-$third of its funds invested in each of the three stocks. The risk$-$free rate is $4\mathrm{.}5\%,$ and the market is in equilibrium. $($That is$,$ required returns equal expected returns.$)$

a$.$ What is the market risk premium $(($:$r_M-r_{RF}$