Stock y has a beta of 9 and an expected return of 126


Stock Y has a beta of .9 and an expected return of 12.6 percent. Stock Z has a beta of .6 and an expected return of 8.9 percent.

What would the risk-free rate have to be for the two stocks to be correctly priced? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Risk-free rate    %  

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Financial Management: Stock y has a beta of 9 and an expected return of 126
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