Assume the stock price today is S(0) = 100 and its yearly volatility is 40%. Assume the risk free rate is r = 10%.

(a) Use the Black-Scholes formula to find the price of a European call option at time 0 with strike K = 104 and expiration in 2 years.

(b) Use the Call-Put Parity to find the price of a European put option at time 0 with strike K = 104 and expiration at time 2 years.

(c) If some one is selling the exact call option in (a) at 30, is there an arbitrage opportunity? If there is, give an arbitrage opportunity