1. European call and put option with exercise prices of $105 and time to expiration equal to 6 months. The current stock price is $105. The interest rate is 10% per year.

1. If the call premium is $12, what should the put price be?
2. If the put premium is $6, is there any arbitrage opportunity? What is your strategy?

2. Suppose the call price is $14.2 and the put price is $9.3 for stock options, where the exercise price is $100, the risk-free interest rate is 5% (continuously compounded), and the time to expiration is one year.

1. Explain how you would create a synthetic stock position and identify the cost.
2. Suppose you observe a $100 stock price; identify any arbitrage opportunities.

I would really appreciate your help. Upvote for the efforts