3. Consider a stock S paying no dividends, with initial price S(0)-$90. European options on the stock with (a) (3 pts) Find the values of K such that the price of the call option on S with strike price K is greater b) (3 pts) Suppose the put option on S with strike price $85 trades at $16. Find the price of the corre- (c) (3 pts) Suppose now a one-year American call option on S with strike price $85 is traded at $25. Find (d) (3 pts) Suppose one-year American call and put options with strike price $90 are traded in the market, maturity of one year are traded in the market. The continuously compounded interest rate is r-5%. than the price of the put option on S with strike price K. sponding call option on S (with same maturity and strike price). an arbitrage opportunity. at prices $20 and $15 respectively. Find an arbitrage opportunity