1. You are planning to invest Rs.25 lakhs for 6 months and link it to the returns on a sectoral index. You are also concerned about limiting the downside risk of this investment and planning to use call options to protect the principal. a. If the risk-free rate is 7.5% p.a., what is the foregone interest on your investment that is available for purchasing Call options? b. Assuming you are buying 30 Call Options on this index using the interest amount above, with strike equal to the current level of the index, what is the participation rate you can expect from this investment? (assume the index is currently at 27,500) c. Is the index-linked deposit risk-free? Justify. (answer in less than two sentences) d. While implementing this strategy, how much of your initial capital will you invest at the risk- free rate?