Question: 4. Suppose rRF = 4%, rM = 13.5%, and bk=1.58. a) Find the required rate of return on stock k (rk) b) If rRF remains

4. Suppose rRF = 4%, rM = 13.5%, and bk=1.58. a) Find the required rate of return on stock k (rk) b) If rRF remains at 4% but rM falls to 10.2%. The slope of the SML does not remain constant. How would these changes affect rk? d) If rRF increases to 6.4% and the slope of the SML remains constant, what are the value of rM and rk? (6 points in total)

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