Question: Now suppose rRF increases to 5 % . The slope of the SML remains constant. How would this affect rM and rUT? I. rM will
Now suppose rRF increases to The slope of the SML remains constant. How would this affect rM and rUT?
I. rM will increase by percentage point and rUT will remain the same.
II Both rM and rUT will decrease by percentage point.
III. Both rM and rUT will remain the same.
IV Both rM and rUT will increase by percentage point.
V rM will remain the same and rUT will increase by percentage point.
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