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You have observed the following returns over time : Assume that the risk-free rate is 6 percent and the market risk premium is 5 percent.

You have observed the following returns over time

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: Assume that the risk-free rate is 6 percent and the market risk premium is 5 percent. (a) What are the betas of stocks X and Y? (b) What is the required rate of return for stocks X and Y? (c) What is the required

Year20162017201820192020StockX14%19%16%3%20%StockY13%7%5%1%11%Market12%10%12%1%15%

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