Covili and Wyatt currently uses a commercial data vendor for information about its positions. Because of this, Paul is unsure exactly how the numbers provided are calculated. The data provider considers its methods proprietary, and it will not disclose how stock betas and other information are calculated. Paul is uncomfortable with not knowing exactly how these numbers are being computed and also believes that it could be less expensive to calculate the necessary statistics in-house. To explore this question, Paul has asked you to do the following assignments.Questions:6. Using monthly data for the last 73 months estimate the average monthly returns and standard deviations for FB, WMT, Three-month Treasury Bill, and S&P 500 (30 points)7. Use the market model to estimate the beta for each of the two stocks (FB and WMT) using the last 72 months risk premiums. Then, estimate the annual required return for each stock based on CAPM using the estimated betas, the average market risk premium and the average risk free rate. (30 points)Instructions for Task 2:1. You may download data from the following sources:a.Go to www.finance.yahoo.com and download the ending monthly stock prices for the last 73 months. Use the adjusted closing price, which adjusts for dividend payments and stock splits.b. Go to www.finance.yahoo.com and download the ending value of the S&P 500 index (^GSPC) for the last 73 months. c.Go to the St. Louis Federal Reserve website (www.stlouisfed.org) and download the three-month Treasury bill secondary market rate (TB3MS) for the last 73 months. 2. Beta is often estimated by linear regression. A model commonly used is called the market model, which is:Rt Rft = i + i [RMt Rft] + tWhere, Rt = Return on the stock Rft = Risk-free rateRMt = Return on a stock market index such as the S&P 500 indexi = Intercept of the regression i = Slope of the regression (or the stock's estimated beta)