Surprised nobody else has commented on this. I’m pretty sure the required return calculated with the CAPM would be 2 + 1.2 (12-2)= 14%. If the expected return (12%) is less than the required return (14%), the security is overvalued. Right?
I also agree on #24. It should be 14% and therefore overvalued. In the explantion they even calculate it correctly, but put the wrong number. Hopefully some more people chime in on this.