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6. Suppose Sterling is considering a European put option that expires in 6 months. It...

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6. Suppose Sterling is considering a European put option that expires in 6 months. It is currently priced at $1.10. The option has a strike price of $45 and the current underlying share price is $42.25. If the risk-free rate is 5% and there are no dividends: (1) is there an arbitrage opportunity? (2) if so, why? (3) if so, what actions should Sterling take (i.e., trades)? (4) if the stock price at maturity turned out to be $48, what is Sterling's profit? (5) if the stock price at maturity turned out to be $40, what is Sterling's profit

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