a) Using the Capital Asset Pricing Model (CAPM), determine whether the following stock (for each stock) is overvalued or undervalued. Given risk-free rate = Rf = 6%, market portfolio return = E (rm) = 15% and expected returns and expected betas are as follows (please show working calculation in word format/ excel)

Stock	Expected Returns	Expected Beta
O	14%	1.20
P	15%	0.75
Q	13%	1.50
R	20%	1.60
S	10%	0.80

b) An investment company manages an equity fund consisting of five stocks with the following market values and betas.

Stock	Market Value	Beta
K	RM100,000	1.10
L	RM25,000	1.20
M	RM50,000	0.75
N	RM125,000	0.60
O	RM165,000	1.30

Assuming risk-free rate = Rf = 7% and market portfolio return = E (rm)= 14%. What is the portfolio's expected return? (please show working calculation in word format/ excel)