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Suppose the quoted call price is $8.5, risk-free continuously compounded interest rate is 3.3 percent...

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Finance

  1. Suppose the quoted call price is $8.5, risk-free continuously compounded interest rate is 3.3 percent per year, stock price $55, strike price $52, time to maturity is 2 months.
    1. If the quoted put price is $10, what is the arbitrage-free call price, is it consistent with the put-call parity?

  1. What is the arbitrage profit and how is it obtained? (show all the steps with formula)

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