Recall that if the put-call parity does not hold, there will be arbitrage opportunities to make a risk_free profit. Using the same notations in chapter 10. Assume you observe the following violation of put-call parity for European options on a no-dividend paying stock: c + Ke^(-rT) < p + So. An arbitrageur can: A Short one put, short one stock, long one call; invest the proceeds to earn a risk-free profit of (p + So c) K*e^(-rT) B Short one put, short one stock, long one call; invest the proceeds to earn a risk-free profit of (p + So c)* e^(rT) K C Short one call; and borrow