Consider the following information on Stocks I and II:

State of Economy	Probability of State of Economy	Rate of Return if State Occurs
		Stock I	Stock II
Recession	.28	.035	?.23
Normal	.63	.335	.15
Irrational exuberance	.09	.195	.43

The market risk premium is 11.3 percent, and the risk-free rate is 4.3 percent.

Requirement 1:

(a)	Calculate the beta and standard deviation of Stock I. (Do not round intermediate calculations. Enter the standard deviation as a percentage. Round your answers to 2 decimal places (e.g., 32.16).)

	Stock I
Beta
Standard deviation		%

(b)	Calculate the beta and standard deviation of Stock II. (Do not round intermediate calculations. Enter the standard deviation as a percentage. Round your answers to 2 decimal places (e.g., 32.16).)

	Stock II
Beta
Standard deviation		%

Requirement 2:

(a)	Which stock has the most systematic risk?

(Click to select)Stock IStock II

(b)	Which one has the most unsystematic risk?

(Click to select)Stock IStock II

(c)	Which stock is riskier?

(Click to select)Stock IIStock I