1. A stock with a beta of 0.6 has an expected rate of return of 13%. If the market return this year turns out to be 10 percentage points below expectations, what is your best guess as to the rate of return on the stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place.)
2. Kroger has a free cash flow to equity of $250 this year. It also has a free cash flow of $350, pays $100 in interest on its debt, and has a tax rate of 20%. How much net debt did Kroger issue?