Suppose the rate of return on short$-$term government securities $($perceived to be risk$-$free$)$ is about $5\%.$ Suppose also that the expected rate of return required by the market for a portfolio with a beta of $1$ is $12\%.$ According to the capital asset pricing model:

Required:

a$.$ What is the expected rate of return on the market portfolio?

Note: Round your answer to $1$ decimal place.

b$.$ What would be the expected rate of return on a stock with $=0?$

Note: Round your answer to $1$ decimal place.

c$.$ Suppose you consider buying a share of stock at $$40.$ The stock is expected to pay $$3$ dividends next year and you expect it to sell then for $$41.$ The stock risk has been evaluated at $=-0\mathrm{.}5.$ Is the stock overpriced or underpriced?

$\backslash$table$[[$a$.$ Expected rate of return,$\%$