Question

Company A has a beta of 0.70, while Company B's beta is 0.95. The required return...

Company A has a beta of 0.70, while Company B's beta is 0.95. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. What is the difference between A's and B's required rates of return?

Select the correct answer.

a. 1.61%
b. 1.63%
c. 1.65%
d. 1.67%
e. 1.69%
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