P826 INTERPRETING BETAA firm wishes to assess the impact of changes in the market return on an asset that has a beta of 1.20.

a. If the market return increased by 15%, what is the expected impact on the assets return?

b. If the market return decreased by 8%, what is the expected impact on the assets return?

c. If the market return did not change, what impact, if any, would be expected on the assets return?

d. Is this asset more or less risky than the market? Explain.