The price of a non-dividend paying stock is $75 and the price of a 9-month European put option on the stock with a strike price of $77 is $3.8. The risk-free rate is 7% per annum with continuous compounding.

1) What should be the price of a 9-month European call option with a strike price of $77, for no arbitrage?

2) If the European call option is currently trading at $5, what arbitrage strategy should be implemented to exploit the arbitrage opportunity?