10 A manager believes his firm will earn a return of 16.20 percent next year. His firm has a beta of 1.98, the expected return on the market is 13.10 percent, and the risk-free rate is 5.10 percent. Compute the return the firm should earn given its level of risk. (Round your answer to 2 decimal places.) Required return % Determine whether the manager is saying the firm is undervalued or overvalued. O overvalued O undervalued

A manager believes his firm will earn a return of 16.20 percent next year. His firm has o beta of 1.98 , the expected return on the market is 13.10 percent, and the risk-free rate is 5.10 percent: Compute the return the firm should earn given its level of risk. (Round your answer to 2 decimal places.) Determine whether the manoger is saying the firm is undervalued or overvalued. overvalued undervalued