A stock is currently priced at $20. In 4 months its price will either go down 10% or up 20%. The risk-free rate is 5% per annum with continuous compounding.

(a) Compute the premium of a 4-month European put with strike price $19.

(b) Use put-call parity to price a 4-month European call with strike price $19.

(c) Compute the premium of the call in part (b) directly and verify that you get the same answer as in part (b)