Masters Corp. issues two bonds with 20-year maturities. Both bonds are callable at $1,060. The first bond is issued at a deep discount with a coupon rate of 5% to yield 11.6%. The second bond is issued at par value with a coupon rate of 12.50% a. What is the yield to maturity of the par bond? (Round your answer to 2 decimal places.) Yield to maturity % Suppose there are two independent economic factors, M, and M2. The risk-free rate is 7%, and all stocks have independent firm- specific components with a standard deviation of 51%. Portfolios A and B are both well diversified. Portfolio A B Beta on Mi 1.6 2.3 Beta on M2 2.4 -0.7 Expected Return (8) 30 11 What is the expected return-beta relationship in this economy? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Answer is complete but not entirely correct. % Expected return-beta relationship E(TP) = 7.00 3.87 BP1 + 7.00 X BP2