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Stock PSTT pays continuous dividens at d = 10% annual. Its price today is $70 and interest rate of r = 3% continuously compounded annual.

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Stock PSTT pays continuous dividens at d = 10% annual. Its price today is $70 and interest rate of r = 3% continuously compounded annual. A call on PSTT with strike K = 60 and maturity T = 1 has premium of C = 6.06. A Put with strike K = 58 and T=1 has a premium of P= 1. Explain what is the arbitrage violation and construct an arbitrage strategy. Stock PSTT pays continuous dividens at d = 10% annual. Its price today is $70 and interest rate of r = 3% continuously compounded annual. A call on PSTT with strike K = 60 and maturity T = 1 has premium of C = 6.06. A Put with strike K = 58 and T=1 has a premium of P= 1. Explain what is the arbitrage violation and construct an arbitrage strategy

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