6. (20 points) Suppose that a nondividend paying stock currently has a price of 60. In addition, assume that the stock price will rise to 65 or fall to 55 over the next one year. Suppose that there exists an oneyear put option written on this stock. Its exercise price is 60. Assume the riskfree rate of interest with continuous compounding is 3% per annum. (a) (10 points) Compute the fair value of the oneyear put option. (b) (10 points) The current market price of the oneyear put option is 1.6. Is a costless arbitrage prot possible, and, if so, how can it be earned