Under the Following Conditions, What Are the Expected Returns for Stocks

Multiple Choice

Under the following conditions, what are the expected returns for stocks X and Y?

$\begin{array}{ll}\lambda^{0}=0.04 & b_{x, 1}=1.2 \\k_{1}=0.035 & b_{x, 2}=0.75 \\k_{2}=0.045 & b_{y, 1}=0.65 \\& b_{y, 2}=1.45\end{array}$

A) 11.58% and 12.8%
B) 15.65% and 18.23%
C) 13.27% and 15.6%
D) 18.2% and 16.45%
E) None of the above