The following graph plots the current security market line (SML) and indicates the return that investors require from holding stock from Happy Corp. OHC). Based on the graph, complete the table that follows: 200 16.0 120 REQUIRED RATE OF RETURN (Percent) 6 Rotum on HC's Stock 80 0 06 15 2.0 10 RISK (B) Value CAPM Elements fuck free rate) Market nisk premium (RPM) Happy Corpock's beta Required rate of return on Happy Corp, stock An analyst belleves that ination is going to increase by 3,0% over the next yeae, while the market riak premium will be unchanged. The analyst uses the Capital Asset Pricing Model (CAPM). The following graph plots the current SML Calculate Happy Corpse new required return. Then, on the graph, use the green points (rectangle symbole) to plot the new SML suggested by this analyst's prediction. Happy Corp's new required rate of return is Tool tip: Mouse over the points on the graph to see their coordinates 0 New SML REQUIRED RATE OF RETURN Percent 12 15 56 20 RISK the slope of the SML The SML helps determine the risk-aversion level among investors. The Ngher the level of risk aversion, the Which of the following statements best describes the shape of the SMI, if investors were not at allrikaverse The SML would have a positive slope, but the slope would be steeper than it would be of investors were risk averse The SML would be a horizontalne The SML helps determine the risk-aversion level among investors. The higher the level of risk aversion, the the slope of the SML. Which of the following statements best describes the shape of the SML if investors were not at all risk averse? The SML would have a positive slope, but the slope would be steeper than it would be if investors were risk averse. The SML would be a horizontal line. The SML would have a positive slope, but the slope would be flatter than it would be if investors were risk averse The SML would have a negative slope