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If the current risk-free rate is 6%, Stock A has a beta of 1.0; Stock Bhas a beta of 2.0; and the market risk premium,

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If the current risk-free rate is 6%, Stock A has a beta of 1.0; Stock Bhas a beta of 2.0; and the market risk premium, TM-T RF, is positive. Which of the following statements is CORRECT? O a. If Stock A's required return is 11%, then the market risk premium is 2.5% b. If Stock B's required return is 11%, then the market risk premium is 2.5% Oc If the risk-free rate increases but the market risk premium stays unchanged, Stock B's required return will increase by more than Stock As. Od. If the risk-free rate remains constant but the market risk premium increases, Stock A's required return will increase by more than Stock B's e Stock B's required rate of return is twice that of Stock A

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