The market risk premium is 6 percent, and the risk-free rate is 2 percent. (Do not round intermediate calculations. Round your answers to 2 decimal places, e.g., 32.16. Enter your return answers as a percent. )

The standard deviation on Stock I's return is (a)_______ percent, and the Stock I beta is (b)_______. The standard deviation on Stock II's return is (c)_______ percent, and the Stock II beta is (d)________ . Therefore, based on the stock's systematic risk/beta, Stock (e)__________ is "riskier".

Consider the following information about Stocks l and Rate of Return If State Occurs Probability of State of Economy State of Economy Stock I Stock II 32 Recession .25 .03 50 23 Normal 12 25 07 Irrational exuberance