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Suppose you observe the following situation: Security Beta Expected Return Peat Co. 1.40 12.4 Re-Peat Co. 0.60 10.2 Assume these securities are correctly priced. Based

Suppose you observe the following situation:

Security	Beta	Expected Return
Peat Co.	1.40	12.4
Re-Peat Co.	0.60	10.2

Assume these securities are correctly priced. Based on the CAPM, what is the expected return on the market? What is the risk-free rate? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

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