Part B, Web-based Exercises:

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

We can find there that the long-term (1928-2016) "arithmetic average" expected return for US S&P-500 stock market index (Rm) was xx.xx% per year, while the long-term (1928-2016) "arithmetic average" expected return for US risk-free 3-month T-bill (Rf) was x.xx% per year.

Also, via http://finance.yahoo.com, CAT's "Summary" or "Statistics", we can find CAT's systematic risk "Beta" value to be xxx.

Collect those above data quotes from web sources, then plug them into the CAPM formula E(Ri) = Rf + BETAi * [E(Rm) - Rf], and calculate "what is CAT's E(Ri)? In other words, when the US stock market reaches the equilibrium, what should be the long-term annual expected return to be fair for CAT stock?"