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Consider the following information on Stocks I and II: Rate of Return if State Occurs State of Economy Recession Normal Irrational exuberance Probability of State

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Consider the following information on Stocks I and II: Rate of Return if State Occurs State of Economy Recession Normal Irrational exuberance Probability of State of Economy .40 .40 .20 Stock I .05 .22 .16 Stock II -.17 .14 .32 The market risk premium is 11 percent and the risk-free rate is 5 percent. a-1. What is the beta of each stock? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Beta Stock Stock

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