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5. Problens 8.05 (Beta and Required Rate of Return) A stock thas a requlred retiam...

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5. Problens 8.05 (Beta and Required Rate of Return) A stock thas a requlred retiam of B5, the riskefree rate is 3.5%, and the market risk premium is 3%. 3. What is the stock's beta? Round your answer to two decimal ploces. b. If the market risk premium increased to 6%, what would happen to the stock's required rate of retum? Assume that the risk-free rate and the beta remain unchathed, Do not round intermediate calculotions, Round your answer to two decimal places. 1. If the stock's beta is less than 1.0, then the change in required rate of refurn will be greater than the change in the market risk premium. II. It the stock's beta is greater than 1.0 , then the change in required rate of return will be less than the change in the market risk premium II. Ir the stock's beta is equal to 1.0 , then the change in required rate of retum will be greater than the change in the market risk premium. N. If the stock's beta is equal to 1.0 , then the change in required rate of return will be less than the change in the market risk premium. v. If the stock's beta is greater than 1.0, then the change in required rate of return will be greater than the change in the market risk premlum. Stock's required rete of return will be

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