Example 2:CML and SML ▣Scenario V: Security E[R]B A 35% 2.0 M 15%1.0 Answer:inconsistent The implied risk-free rate would be negative if A lies on the SML. 2010/Yichuan Liu 17Example 2: CML and SML  Scenario Scenario V: Security E[R] β A 35% 2.0 M 15% 1.0  Answer: inconsistent The implied risk‐free rate would be negative if A lies on the SML. 2010 / Yichuan Liu 17