According to your personal analysis, the expected return of NFLX should be 8.5%. However, this is not necessarily what the CAPM is saying. The expected return on the market is 10.1%, the risk-free rate is 1.3%, and the beta for NFLX is 1.18.

You want to exploit the mispricing using an arbitrage portfolio and the recipe from the book. Give the weight in the risk-free asset in percentage.