The folowing oraph plots the current scourty market Line (5ML) and indicates the return that investors require from holding stodk from Happy Corp. (HC), Dased on the graph, complete the tabie that follows: An analyst believes that inflation is going to increase by 2.0% over the next year, while the market risk premium will be unchanged. The analyst uses the Capital Asset Pricing Model (CAPM). The following graph plots the current SML. Calculate Happy Corp.'s new required return. Then, on the graph, use the green points (rectangle symbols) to plot the new sML suggested by this analyst's prediction. Happy Corp.'s new required rate of return is An analyst beheves that inflation is going to increase by 2.0% over the next year, while the market risk premium will be unchanged. The analyst uses the Capital Asset Priang Model (CAPM). The following graph plots the ourrent SML. Calculate Happy Corp.'s new required retum. Then, on the graph, use the green points (rectangle symbols) 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, The SMi. helos defermine the nek-aversion level among investors, The higher the level of risk arvertion, the the sibest of the SMi. 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 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. The SML. would be a horizontal line