PLEASE SHOW YOUR WORK AND FORMULAS, SO I CAN LEARN THIS MATERIAL.

Problem 6-14 Historical Returns: Expected and Required Rates of Return

You have observed the following returns over time:

Year	Stock X	Stock Y	Market
2012	14%	13%	14%
2013	18	8	9
2014	-15	-8	-13
2015	3	3	1
2016	24	12	13

Assume that the risk-free rate is 4% and the market risk premium is 6%. Do not round intermediate calculations.

What is the beta of Stock X? Round your answer to two decimal places. ___

What is the beta of Stock Y? Round your answer to two decimal places. ___

What is the required rate of return on Stock X? Round your answer to one decimal place. ___%

What is the required rate of return on Stock Y? Round your answer to one decimal place. ___%

What is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y? Round your answer to one decimal place. ___%