Suppose rre = 6%, rm = 13%, and b; = 1.8. a. What is ri, the required rate of return on Stock i? Round your answer to one decimal place. % b. 1. Now suppose rrf increases to 7%. The slope of the SML remains constant. How would this affect rm and ri? I. Both rm and will decrease by 1 percentage point. II. Both rm and will remain the same. III. Both rm and i will increase by 1 percentage point. IV. rm will remain the same and r; will increase by 1 percentage point. V. rm will increase by 1 percentage point and i will remain the same. -Select- 2. Now suppose TRF decreases to 5%. The slope of the SML remains constant. How would this affect rm and ri? I. rm will decrease by 1 percentage point and r; will remain the same. II. I'm will remain the same and r; will decrease by 1 percentage point. III. Both rm and will increase by 1 percentage point. IV. Both rm and i will remain the same. V. Both rm and r will decrease by 1 percentage point. -Select- v C. 1. Now assume that ref remains at 6%, but rm increases to 14%. The slope of the SML does not remain constant. How would these changes affect ri? Round your answer to one decimal place. The new n will be %. 2. Now assume that ree remains at 6%, but I'm falls to 12%. The slope of the SML does not remain constant. How would these changes affect r? Round your answer to one decimal place. The new r will be %