In the CFAI 2011 actual AM exam, question 4 (Equity Market Valuation) part E:
Determine, if the broad equity market is overvalued/fairly valued/undervalued according to the Fed Model & the Yardeni Model. “Justify each response with one reason. Show your calculation.”
Is there any other reason than calculation? Is there anything else needed than the calculation of the ratios and concluding whether the market is fairly valued to get all the points?