Questions Problem 8.05 (Beta and Required Rate of Return) Question 4 of 20 Check My Work (3 remaining) 3 eBook 5 Astock has a required return of 8%, the risk-froe rate is 4.5%, and the market risk premium is 2% 1. What is the stock's beta? Round your answer to two decimal places 6 21 0 b. If the market risk premium increased to 4%, what would happen to the stock e required rati Fraturn? Assume thot the risk-free rate and the beta remain unchanged. Do not round intermediate calculations, Round your anger to two decimal places 1. If the stock's beta is less than 1,0, then the change in required rate of return will be greater than the change in the market risk premium II. If the stock's beta is greater than 1.0, then the change in required rate of retum will be less than the change in the market risk premium. 111. If the stock's bet is equal to 1.0, then the change in required rate of return will be greater than the change in the market risk premium. IV. If the stock's bete is equal to 1.0, then the change in required rate of return will be less than the change in the market risk premium V If the stock's betn is greater than 1,0, then the change in required rate of return will be greater than the change in the market risk premium 10 11 . 12 13 -Select- Stock's required rate of return will be 14 O 15 o 16 Check My Work (3 remaining)