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Year Stock X Stock Y Market 2009 15% 12% 14% 2010 20 8 10 2011 -13 -8 -12 2012 3 3 2 2013 23 8

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Year Stock X Stock Y Market 2009 15% 12% 14% 2010 20 8 10 2011 -13 -8 -12 2012 3 3 2 2013 23 8 17 Assume that the risk-free rate is 5% and the market risk premium is 6%. Do not round intermediate calculations. a. What is the beta of Stock X? Round your answer to two decimal places. b. What is the beta of Stock Y? Round your answer to two decimal places. c. What is the required rate of return on Stock X? Round your answer to one decimal place. % d. What is the required rate of return on Stock Y? Round your answer to one decimal place. % one decimal place. e. What is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y? Round your answer %

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