This video covers a fundamental finance exam question: determining whether an asset is underpriced, overpriced, or fairly priced using the Capital Asset Pricing Model (CAPM). You'll learn how to calculate the required rate of return, interpret the Security Market Line (SML), and analyze systematic risk. The example uses PepsiCo to showcase how expected returns compare to the required rate of return. Perfect for finance students seeking clarity on CAPM concepts, pricing logic, and exam preparation techniques.