Conclude whether there is an arbitrage opportunity

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Q1. Assume the yen is trading at ¥100/$, the Japanese interest rate is 2.5 percent also the U.S. interest rate is 6 percent. A European call option at a strike of 100 with a two-month maturity is currently trading at 1.93 cents per 100 yen also the put option at the same strike also the same maturity trades at 2.00 cents per 100 yen. Conclude whether there is an arbitrage opportunity in the option market, using the put-call parity.

Q2. Why are property rights important for the growth of a nation's standard of living?

Reference no: EM1315330

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