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Suppose a stocks price is $37, and the continuously compounded interest rate is 6%. The stock does not pay dividends. A 3-month $40-strike European call

Suppose a stocks price is $37, and the continuously compounded interest rate is 6%. The stock does not pay dividends. A 3-month $40-strike European call costs $1.28, and a 3-month $40-strike European put costs $4.16. In this situation, an arbitrageur would...

Answer - sell the stock, buy the call and sell the put.

please show work. thanks.

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