In this video, we dive into solving a comprehensive finance problem that involves calculating the price of Pepsico’s stock under different economic conditions using the Capital Asset Pricing Model (CAPM) and the equity valuation formula. We begin by identifying key parameters like the risk-free rate, the expected return on the market, and the stock’s beta, then apply these values to calculate the stock price. As we go through the process step-by-step, we also explore how changes in market conditions—like shifts in the required rate of return, growth rate, and beta—affect the stock’s price. This video offers clear guidance on using these formulas to evaluate stock prices and assess the impact of economic changes.