You are given the following information for Wine and Cork Enterprises (WCE):

r_RF = 3%; r_M = 8%; RP_M = 5%, and beta = 1.2

1. Assume now that there is no change in inflation, but market risk premium increases by 1%. What is WCE's required rate of return now? Do not round intermediate calculations. Round your answer to two decimal places.

2,If inflation increases by 1% and market risk premium increases by 1%, what is WCE's required rate of return now? Do not round intermediate calculations. Round your answer to two decimal places.