1. An American-style put option with eight months to maturity has a strike price of R40. Te underlying stock now sells for R48. The put premium is R10. What will be te value of a call option for no arbitrage opportunity to exist? Te interest rate is 4%.

2.Mondi is currently selling for R50. In a year's time, the price could increase by 10% or fall by 5%. The interest rate is 1%. Calculate the current price of a European call option on the stock with an exercise price of R48.

3. You are attempting to value a put option with an exercise price of R100 and 1 year to expiration. The underlying stock pays no dividends, it's current price is R100, and you believe it has a chance of increasing to R115 or decreasing to R80. The risk-free of interest is 10%. Calculate the option's value using the binomial model.