(a) An investor buys a T-year European call with strike price of X and sells a T-year European put with the same strike price. Show that the investor position is the same as a long position in a forward contract with delivery price X and maturity T.

(b) A six-month European call option to buy one Euro for C$ 1.60 costs C$ 0.147. A six-month European put option to sell one Euro for C$ 1.60 costs C$ 0.050. A forward contract to buy 1 Euro for C$ 1.60 will expire in six months. What is the value of the long forward contract? Explain your answer.

(c) The six-month risk-free interest rate in Canada is 6% per annum with continuous compounding. Based on your answer to part (b), what is the six-month C$/Euro forward exchange rate?