Using the CAPM approach, draw the SML$.$ On the same graph, illustrate $($draw$)$ an increase in risk aversion.

Using the CAPM approach, draw the SML$.$ On the same graph illustrate $($draw$)$ a decrease in intlation rate.

Smith and Daughter inc has a beta of $0\mathrm{.}9,$ the risk$-$free rate is $3\mathrm{.}2\%,$ and the expected market risk premium $5\%.$ Brady Enterorise expected return is $8\%$

a$.$ Calculate the required return for Brady Enterprise.

b$.$ Comparing expected and required return, determine whether Brady Enterprise is over$/$underpriced and what must happen to the price of the stock.