Your goal is to estimate the cost of capital of a small computer firm AST using the CAPM and the Fama-French 3-Factor Model. The risk-free rate is 4% and the excess expected return on the market is 8.6%. (a) According to the CAPM the beta of AST is 1.65. What is the CAPM expected return of AST? (b) Estimating the factor loadings for the Fama-French model, we find m = 1.58, SMB=1.19 and HML= -0.15. Given that the expected return on the SMB factor is 5.2%, and the expected return on the HML factor is 4.8%, what is the expected return of AST according to the Fama-French 3-Factor Model? (c) Using the Fama-French model, what is the systematic volatility (standard deviation) of AST stock given the volatility of the market portfolio is 16%, the volatility of the SMB factor is 15% and the volatility of HML is 13%? (Recall that the three factors are uncorrelated with each other).