Currently, a stocks price is $120. The stock doesnt pay any dividend. The continuously compounded risk-free interest rate is 3%. A one-year European put option on the stock with a strike price of $115 is trading at $6.

(a) (10 pts.) How can you create a synthetic European call option with the same strike price and maturity using put, risk free bonds, and the underlying stock, based on the principle of put-call parity?

(b) (10 pts.) What should be the price of the synthetic call you created?

(c) (10 pts.) Suppose the actual call price is $13, is there an arbitrage opportunity? If so, how could you set up your trade? You only need to specify which securities to long and short, no need to show your profit from the strategy.