Identify the appropriate arbitrage trading strategy

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Reference no: EM133291043

Question: Suppose an American Put is trading for $16.50, and an American Call is trading for $15, where both Options have identical terms. The underlying stock price is $99, and the exercise price is $100.The annual risk-free interest rate is 5%, and the time to expiration for both options is one year.

Assuming the stock pays no dividend, identify the appropriate arbitrage trading strategy.

Reference no: EM133291043

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