The upper and lower bounds for the european call option

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You are considering an investment on a 10-month European call and a 10-month European put options where the underlying asset is a non-dividend-paying stock with the market price of $38. The strike price for both options is $34 and the risk-free interest rate is 4% per annum.

a) What are the upper and lower bounds for the European call option?

b) What are the upper and lower bounds for the European put option?

c) What are the upper and lower bounds for the call and the put options if they were American?

Reference no: EM131579175

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