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A non dividend paying stock is trading at $45. What arbitrage opportunity is present if an American call option on the stock with an exercise

A non dividend paying stock is trading at $45. What arbitrage opportunity is present if an American call option on the stock with an exercise price of $42 is trading at $2?

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Answer In this scenario there is an arbitrage opportunity because the call option is underpriced Heres why Stock price 45 Call option strike price exe... blur-text-image

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