1. Stock A has a required expected return of 6 percent and stock B has a required expected return of 10 percent. A. Assuming the beta of Stock B is twice the size of the beta of Stock A, use the capital asset pricing model to determine the T-bill rate. B. Now suppose that the expected return on the market portfolio rises from 6 to 7 percent, with the other parameter values remaining as given in Part A. What will be the new required expected returns for Stock A and for Stock B? Please show your work.

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