If the European call option price is less than Max $S_0-K{e}^{-rT},0,$ then there is an arbitrage opportunity. The arbitrage strategy is:

Form a Zero dollar investment portfolio $($ignoring margin and transaction cost$)$ with a$)$long call b$)$short stock and c$)$risk$-$free investment

Form a Zero dollar investment portfolio $($ignoring margin and transaction cost$)$ with a$)$short call b$)$long stock and c$)$risk$-$free borrowing

Take a short position in the call option $($naked strategy without underlying stock$)$

Take a long position in the call option $($naked strategy without underlying stock$)$

If the European Put on stocks of company $"$A$"$ is expensive then that determined by the put$-$call parity relationships. It is further determined that the European

Call on company $"$A$"$ stocks is within the permissible boundaries. Then there is an arbitrage opportunity and one can arbitrage using the following manner:

$($Assume no dividends are declared or paid$)$

A zero dollar portfolio consisting of a$)$ long put b$)$ long stock c$)$ short call d$)$ risk$-$free borrowing

A zero dollar portfolio consisting of a$)$ short put b$)$ short stock c$)$ long call d$)$ risk$-$free investment

A zero dollar portfolio consisting of a$)$ short put b$)$ short stock c$)$ short call d$)$ risk$-$free borrowing

A zero dollar portfolio consisting of a$)$ long put b$)$ long stock c$)$ long call d$)$ risk$-$free investment