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Suppose rRF = 6%, rM = 11%, andbi = 1.5.2. Now suppose rRF decreases to 5%. The slope of theSML remains constant. How would this affect rM andri?-Select-IIIIIIIVVItem 3What is ri, the required rate of return on Stock i?Round your answer to two decimal places.%1. Now suppose rRF increases to 7%. The slope of theSML remains constant. How would this affect rM andri?Both rM and ri will increase by 1%.rM will remain the same and ri willincrease by 1%.rM will increase by 1% and ri will remainthe same.Both rM and ri will decrease by 1%.Both rM and ri will remain the same.-Select-IIIIIIIVVItem 2Ā Ā rM will decrease by 1% and ri will remainthe same.rM will remain the same and ri willdecrease by 1%.Both rM and ri will increase by 1%.Both rM and ri will remain the same.Both rM and ri will decrease by 1%.1. Now assume that rRF remains at 6%, butrM increases to 12%. The slope of the SML does notremain constant. How would these changes affect ri?Round your answer to two decimal places.The new ri will beĀ Ā %.2. Now assume that rRF remains at 6%, butrM falls to 10%. The slope of the SML does not remainconstant. How would these changes affect ri? Round youranswer to two decimal places.The new ri will beĀ Ā %.