Stock Y has a beta of 1.2 and an expected return of 11.1 percent. Stock Z has a beta of.80 and an expected return of 7.85 percent. points What would the risk-free rate have to be for the two stocks to be correctly priced? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) eBook Risk-free rate Ask Print References Return to question 20 Consider the following information about Stocks I and II: Rate of Return If State Occurs points State of Economy Recession Normal Irrational exuberance Probability of State of Economy .15 .70 Stock / .03 .20 Stock II -.23 .09 .43 The market risk premium is 7 percent, and the risk-free rate is 3.5 percent. (Round your answers to 2 decimal places, e.g., 32.16.) X Answer is complete but not entirely correct. The standard deviation on Stock I's return is deviation on Stock Il's return is stock's systematic risk/beta, Stock 6.78 percent, and the Stock I beta is percent, and the Stock Il beta is is riskier. 1.74 . The standard . Therefore, based on the 0.18 X 1 0.83