1. Look at the prices of the American Express options in the chapter. The February call option...

Question:

1. Look at the prices of the American Express options in the chapter. The February call option with X = 37.5 is priced at 6 3/8, whereas the April option with the same exercise price is priced at 6. Can you devise an arbitrage out of these prices? Do you have an explanation for the newspaper quotes?

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