) Consider an option on a non-dividend-paying stock when the stock price is $30, the exercise price is $28, the risk-free interest rate is 5% per annum, the volatility is 30% per annum, and the time to maturity is four months.

(a) What is the price of the option if it is a European call?

(b) What is the price of the option if it is an American call?

(c) What is the price of the option if it is a European put?

(d) Verify that putcall parity holds.