b) Assume that you expect the rate of inflation in the economy to be 3 percent, giving a risk-free rate (RFR) of 6 percent and a market return (RM) of 12 percent. D) Draw the security market line (SML) under these assumptions. il) Subsequently, you expect the rate of inflation to increase from 3 percent to 6 percent. Draw another SML on the graph from part D) above showing the effect of changed inflationary conditions. Briefly discuss the effect of the change on the RFR and RM