Problem 11-07 The secunty market line is estimated to be k=8% + (9.2%-8%). You are considering two stocks. The beta of A is 1.7. The firm offers a dividend yield during the year of 6 percent and a growth rate of 7.2 percent. The beta of Bis 1.2. The firm offers a dividend yield during the year of 6.9 percent and a growth rate of 6.5 percent a. What is the required return for each security? Round your answers to two decimal places. Stock A: % Stock B: % b. Why are the required rates of return different? The difference in the required rates of return is the result of select being riskier. c. Since A offers higher potential growth, should it be purchased? Stock A Select be purchased. d. Since offers higher dividend yield, should it be purchased? Stock Select be purchased. e. Which stock(s) should be purchased? Select should be purchased