Suppose that the index model for stocks A and B is estimated from excess returns with the following results: R_A = 3.5% + 0.65R_M + e_A R_B = 1.6% + 0.80R_M + e_{B M} = 21%; R-square_A = 0.22; R-square_B = 0.14 Break down the variance of each stock to the systematic and firm-specific components. (Do not round intermediate calculations. Calculate using numbers in decimal form, not percentages. Round your answers to 4 decimal places.)

Suppose that the index model for stocks A and B is estimated from excess returns with the following results: R_A = 3.5% + 0.65R_M + e_A R_B = 1.6% + 0.80R_M + e_{B M} = 21%; R-square_A = 0.22; R-square_B = 0.14 Break down the variance of each stock to the systematic and firm-specific components. (Do not round intermediate calculations. Calculate using numbers in decimal form, not percentages. Round your answers to 4 decimal places.)

Suppose that the index model for stocks A and B is estimated from excess returns with the following results: R_A = 3.5% + 0.65R_M + e_A R_B = 1.6% + 0.80R_M + e_{B M} = 21%; R-square_A = 0.22; R-square_B = 0.14 Break down the variance of each stock to the systematic and firm-specific components. (Do not round intermediate calculations. Calculate using numbers in decimal form, not percentages. Round your answers to 4 decimal places.)

	Risk for A	Risk for B
Systematic
Firm-specific