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Historical Returns: Expected and Required Rates of Return You have observed the following returns over time: Year 2014 2015 2016 2017 2018 Assume that the
Historical Returns: Expected and Required Rates of Return You have observed the following returns over time: Year 2014 2015 2016 2017 2018 Assume that the risk-free rate is 6% and the market risk premium is 4% Stock X Stock Y Market 15% 17 13 11% 1096 18 16 a. What are the betas of Stocks X and Y? Do not round intermediate calculations. Round your answers to two decimal places. Stock X: Stock Y b. What are the required rates of return on Stocks X and Y? Do not round intermediate calculations. Round your answers to two decimal places. Stock X Stock Y: c, what is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y? Do not round intermediate calculations. Round your answer to two decimal places
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