The CAPM uses the principles of modern portfolio theory to determine if a security is fairly valued. It relies on assumptions about investor behaviors, risk and return distributions, and market fundamentals that don't match reality. The goal of the CAPM formula is to evaluate whether a stock is fairly valued when its risk and the time value of money are compared with its expected return. In other words, by knowing the individual parts of the CAPM, it is possible to gauge whether the current price of a stock is consistent with its likely return. Do you agree (or not)? Discuss using an example. 200 words.