1.

URP CORP ICAPM

URP CORP has globalized its own business activities, and has operations in 3 different
countries (London, New York, Brazil), having several investments in the United States.
Also the investor base that owns URP CORP shares has also globally diversified. URP CORP
shares are now listed London, Sao Paulo and New York, in addition to their home listing on
the Mila Exchange. The year that started 1.1.2019 is closing in a few days on 31.12.2019.
Using the ICAPM, URP CORP beta, when calculated against a larger global equity market
index, which includes these foreign markets and their investors, is a lower 0.90. The
expected world market return for a larger globally integrated equity market is 8.00% and
the Risk free rate is 4.00%. Using the following information calculate URP CORP ICAPM

London New York Brazil

S0 = Sol 4.30/ GBP S0 = Sol 3.37/ USD S0 = Sol 0.87/ BRL
S1 = Sol 4.40/GBP S1 = Sol 3.40/USD S1 = Sol 0.80/BRL
F = Sol 4.35/ GBP F = Sol 3.35/USD F = Sol 0.83/BRL
Gamma´S For Income
ΓLondon = 0.74
ΓNewYork = 0.81
ΓBrazil = 0.59
2. ANG CORP ICAPM
ANG CORP, CFO Juan Perez Quispe, has expander even more its business activities, and
now has operations in 5 different countries (Paris, Berlin, Bogota, Tokyo, India), having
several investments in the France and Locally. The year that started 1.1.2025 is closing in
a few days on 31.12.2025. Using the ICAPM, ANG CORP beta, 0.85. The expected world
market return for a larger globally integrated equity market is 9.00% and the Risk free rate
is 5.50%. Using the following information calculate ANG CORP International Capital Asset
Pricing Model.

Paris Berlin Bogota

S0 = Sol 3.89/ EUR S0 = Sol 3.89/ EUR S0 = Sol 0.0010/ COP
S1 = Sol 3.75/EUR S1 = Sol 3.75/EUR S1 = Sol 0.00097/COP
F = Sol 3.80/EUR F = Sol 3.80/EUR F = Sol 0.00093/ COP

Tokyo New Delhi

S0 = Sol 0.031/ JPY S0 = Sol 0.048/ INR
S1 = Sol 0.032/ JPY S1 = Sol 0.047/INR
F = Sol 0.030/ JPY F = Sol 0.0475/ INR

Gamma´S For Income

ΓParis = 0.54
ΓBerlin = 0.90
ΓBogota = 0.09
ΓTokyo = 0.70
ΓN.Delhi = 0.28

3. URP Corp Perú borrowed EUR 2,500,000 for one year at a 4% interest. During the year the
EURO appreciates from an initial EUR 0.39/SOL to EUR 0.27/ SOL .
a. What is the Sol cost of debt?
b. After one year URP Corp must pay how much? In Soles?
c. What is the total cost of borrowing?
d. What is the after tax cost EURO debt, when Peru´s income tax rate is 29%.