Suppose ref = 5%, r = 11%, and b; = 1.3. Round your answer to one decimal place. a. What is, the required rate of return on Stock % b. 1. Now suppose rrf increases to 6%. The slope of the SML remains constant. How would this affect rm and n? I. Both rm and will decrease by 1 percentage point. II. Both rm and r; will remain the same. III. Both rm and r will increase by 1 percentage point. IV. I will remain the same and r will increase by 1 percentage point. V. I will increase by 1 percentage point and r will remain the same. -Select- 2. Now suppose rre decreases to 4%. The slope of the SML remains constant. How would this affect rm and n? 1. Both rm and r, will decrease by 1 percentage point. II. I will decrease by 1 percentage point and n will remain the same. III. rm will remain the same and will decrease by 1 percentage point. IV. Both rm and r, will increase by 1 percentage point. V. Both rm and r will remain the same. Select- C. 1. Now assume that rre remains at 5%, but rm increases to 12%. The slope of the SML does not remain constant. How would these changes affect ri? Round your answer to one decimal place. The new r will be %. 2. Now assume that ree remains at 5%, but im falls to 10%. The slope of the SML does not remain constant. How would these changes affect n? Round your answer to one decimal place. The new ri will be %