Suppose IRF = 3%, I'M = 10%, and b = 1.8. a. What is ri, the required rate of return on Stock i? Round your answer to one decimal place. % b. 1. Now suppose rrf increases to 4%. The slope of the SML remains constant. How would this affect rm and n? I. I will remain the same and ri will increase by 1 percentage point. II. rm will increase by 1 percentage point and ri will remain the same. III. Both rm and r; will decrease by 1 percentage point. IV. Both rm and r will remain the same. V. Both rm and will increase by 1 percentage point. -Select- 2. Now suppose l'rf decreases to 2%. The slope of the SML remains constant. How would this affect rm and n? I. I will decrease by 1 percentage point and will remain the same. II. I'm will remain the same and will decrease by 1 percentage point. III. Both rm and will increase by 1 percentage point. IV. Both rm and i will remain the same. V. Both rm and i will decrease by 1 percentage point. -Select- C. 1. Now assume that ref remains at 3%, but rm increases to 11%. The slope of the SML does not remain constant. How would these changes affect n? Round your answer to one decimal place. The new n will be %. 2. Now assume that ref remains at 3%, but im falls to 9%. The slope of the SML does not remain constant. How would these changes affect ni? Round your answer to one decimal place. The new r will be %