Turkish Airlines stock trades as an American Depository Receipt (ADR) in the U.S. Over the counter (OTC) market. In Borsa Istanbul, Turkish Airlines stock closed at TRY 12.61 per share on June 2, 2021. On the same day, the Turkish Lira to the U.S. dollar spot exchange rate was TRY 6.71/$1.00. 10 underlying Turkish Airlines shares are packaged into one ADR.
a) The no-arbitrage U.S. price of one ADR for Turkish Airlines is:
b) Based on what principle can we get the result in part a? In reality do we see the same price or different prices? Why or why not?