PROBLEM 4 Suppose that the risk-free rate, RF, were 8 percent and the required rate of return on the market, R(Rm),were 14 percent were 14 percent. a. Write out the Security Market Line (SML), and explain each term. b. Plot the SML on a sheet of paper. c. Suppose that inflation expectations increase such that the risk-free rate, RF, increases to 10 percent and the required rate of return on the market, R(Rm), increases to 16 percent. Write out and plot the new SML.