Question content area top Part 1 (Capital asset pricing model)Grace Corporation is considering the following investments. The current rate on Treasury bills is percent and the expected return for the market is percent. Stock Beta K G B U (Click on the icon in order to copy its contents into a spreadsheet.) a.Using the CAPM, what rates of return should Grace require for each individual security? b.How would your evaluation of the expected rates of return for Grace change if the risk-free rate were to rise to percent and the market risk premium were to be only percent? c.Which market risk premium scenario (from part a or b) best fits a recessionary environment? A period of economic expansion? Explain your response. Question content area bottom Part 1 a.The expected rate of return for security K, which has a beta of , is enter your response here%. (Round to two decimal places.) Part 2 The expected rate of return for security G, which has a beta of , is enter your response here%. (Round to two decimal places.) Part 3 The expected rate of return for security B, which has a beta of , is enter your response here%. (Round to two decimal places.) Part 4 The expected rate of return for security U, which has a beta of , is enter your response here%. (Round to two decimal places.) Part 5 b.If the risk-free rate were to rise to % and the market risk premium were to be only %, the expected rate of return for security K is enter your response here%. (Round to two decimal places.) Part 6 If the risk-free rate were to rise to % and the market risk premium were to be only %, the expected rate of return for security G is enter your response here%. (Round to two decimal places.) Part 7 If the risk-free rate were to rise to % and the market risk premium were to be only %, the expected rate of return for security B is enter your response here%. (Round to two decimal places.) Part 8 If the risk-free rate were to rise to % and the market risk premium were to be only %, the expected rate of return for security U is enter your response here%. (Round to two decimal places.) Part 9 c.Which market risk premium scenario (from part a or b) best fits a recessionary environment? Part a Part b . (Select from the drop-down menu.) Part 10 Which market risk premium scenario (from part a or b) best fits a period of economic expansion? Part a Part b . (Select from the drop-down menu.)