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

Multiple Choice

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

$\begin{array}{ll}\lambda^{0}=0.05 & b_{y, 1}=0.75 \\k_{1}=0.06 & b_{y, 2}=1.35 \\k_{2}=0.05 & b_{z, 1}=1.5 \\& b_{z, 2}=0.85\end{array}$

A) 17.61% and 13.23%
B) 16.25% and 18.25%
C) 13.24% and 28.46%
D) 14.83% and 17.69%
E) None of the above