11. A share of Formila Corp. is currently trading at $38.50, and a 1-year call option on Formila with X=$40 is trading at $3. The risk-free interest rate is 4.5%. a. What should be the price of a 1-year put option on the stock with X=$40 ? Why? b. If the price of a put is $2, construct an arbitrage strategy. c. If the price of a put is $4, construct an arbitrage strategy. Part a. Hint - use Put-Call Parity Formila stock price Option exercise price, X Option exercise time, T Interest rate, r 4.50%C+PV(X) - describe an arbitage strategy