A A European call option on a non-dividend-paying stock with a strike price of $18 and an expiration date in one year costs $3. The stock price is $20 and the risk-free interest rate is 10% per annum. What are the upper and lower bounds for the option price? Is there an arbitrage opportunity?

B. . A European put option on a non-dividend-paying stock with a strike price of $40 and an expiration date in six months costs $1. The stock price is $37 and the risk-free interest rate is 5% per annum. What are the upper and lower bounds for the option price? Is there an arbitrage opportunity?

Could you please explain the answers and provide the formula used? thank you