You have just done a regression of monthly stock returns of Royal Inc., on monthly market returns

over the past five years and have come up with the following regression:

Ra $=0\mathrm{.}03+1\mathrm{.}4\backslash$times MRP

The variance of the stock is $50\%,$ and the variance of the market is $20\%.$ The current risk$-$free rate

is $3\%$ and the market risk premium is $8\mathrm{.}76\%.$ The stock is currently selling for $$50,$ down $$4$ over

the past year; it has paid a dividend of $$2\mathrm{.}50$ during the past year and expects to pay a dividend of

$$2$ over the next year. Royal Inc. has a tax rate of $40\%.$

What was Royal Inc.$$s return over the past year.