eBook Problem Walk-Through Suppose IRF = 8%, IM = 11%, and bj = 1.3. a. What is n, the required rate of return on Stock i? Round your answer to two decimal places. % b. 1. Now suppose of increases to 9%. The slope of the SML remains constant. How would this affect rm and n? I. Both rm and will decrease by 1%. II. Both rm and will remain the same. III. Both rm and will increase by 1%. IV. I will remain the same and I will increase by 1%. V. rm will increase by 1% and i will remain the same. -Select- 2. Now suppose TRF decreases to 7%. The slope of the SML remains constant. How would this affect rm and n? I. Both rm and will increase by 1%. II. Both rm and will remain the same. III. Both rm and i will decrease by 1%. IV. IM will decrease by 1% and i will remain the same. V. rm will remain the same and will decrease by 1%. -Select- c. 1. Now assume that rrr remains at 8%, but rm increases to 12%. The slope of the SML does not remain constant. How would these changes affect n? Round your answer to two decimal places. The new n will be % 2. Now assume that rRF remains at 8%, but im falls to 10%. The slope of the SML does not remain constant. How would these changes affect n? Round your answer to two decimal places. The new n will be %. Check My Work (1 remaining) Icon Key