. Predict and explain the effect on the options premium from the following:

a. for a call option, a reduction in variance of the underlying security when it is in the money;

b. for a put option, a reduction in variance of the underlying security when it is in the money;

c. for a call option, a reduction in variance of the underlying security when it is out of the money;;

d. for a put option, , a reduction in variance of the underlying security when it is out of the money;