15.

D) strangle E) elephant spread 15. A European call option and put option on a stock both have strike price $19 and expiration date in six months. The put price is $2.50 and the call price is $2.50. The risk-free interest rate is 8% and the current stock price is $19. How can you take advantage of the arbitrage opportunity in this situation? A) buy put, buy stock, sell call B) buy put, buy call, sell stock C) buy put, buy call, buy stock D) buy call, sell stock, sell put E) There is no arbitrage opportunity