Consider the example of two assets - two-period bond and a risky asset - with dividends and prices over three dates, as in question 3 in Problem Set 7. Recall that the price of a European call option on asset 2 with exercise price 1.8 and exercise date 2 was found to be pcall,0 = 0.532.
(i) Find date-0 price of European put option with on asset 2 with the same ma- turity and exercise price using the put-call parity relationship.
(ii) Suppose that the price of the put option is different from the one you found in part (i), say pput,0 = 0.3. Construct an arbitrage portfolio of assets and options. (Assume that call option has price 0.532).