Question 4 a. Explain how and why an increase in each of the following affects the prices of both call and put options, holding all other variables constant: i. The current stock price (3 points) ii. The strike price (3 points) b. What is a lower bound for the price of a nine-month European put option on a non-dividend- paying stock when the stock price is $65, the strike price is $69, and the risk-free interest rate is 5% per annum? (4 points) c. a What is a lower bound for the price of a nine-month European call option on a non-dividend- paying stock when the stock price is $75, the strike price is $70, and the risk-free interest rate is 8% per annum? (4 points) Question 4 a. Explain how and why an increase in each of the following affects the prices of both call and put options, holding all other variables constant: i. The current stock price (3 points) ii. The strike price (3 points) b. What is a lower bound for the price of a nine-month European put option on a non-dividend- paying stock when the stock price is $65, the strike price is $69, and the risk-free interest rate is 5% per annum? (4 points) c. a What is a lower bound for the price of a nine-month European call option on a non-dividend- paying stock when the stock price is $75, the strike price is $70, and the risk-free interest rate is 8% per annum? (4 points)