Suppose there are two independent economic factors, M1 and M2. The risk-free rate is 4%, and all stocks have independent firm-specific components with a standard deviation of 45%. Portfolios A and B are both well diversified.

Portfolio	Beta on M1	Beta on M2	Expected Return (%)
A	1.5	2.0	35
B	1.9	-0.6	13

What is the expected returnbeta relationship in this economy? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Expected returnbeta relationship E(r_P) =________% +____________P1 +_______________P2