b. Using CAPM, determine whether these stocks A, B, C are underpriced or overprice? (i.e., calculate the required E(R) using CAPM and then compare with the E(R) you forecast in the table.)

22. You have been provided the following data about the securities of three firms, the market portfolio, and the risk-free asset *Correlation indicates the correlation between a security and the market portfolio. For example, the correlation between stock B and market portfolio is 0.50 a. Fill in the missing values in the table (i.e., find out (i), (ii), .., (viii) Hint: the formula to calculate beta is =m2Cov(ri,rm)=m2(ri,rm)im=m(ri,rm)i (ri,rm) is the correlation between stock i and market portfolio