Here is a stock: The beta is 1.65. The expected return on the market is 8.3%. The risk-free rate is 2.2%. According to the Capital Asset Pricing Model, what must the expected return of this stock be? What is alpha if the actual return is 12%? Is this stock undervalued?

Choices:

10.52%, -1.48%, Yes.

10.52%, 1.48%, No.

12.27%, 0.27%, Yes.

12.27%, -0.27%, No.