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a) The protective put strategy is also known as stock price insurance. Why? (5 marks) b) Explain the put-call parity concept. (5 marks) c) If

a) The protective put strategy is also known as stock price insurance. Why? (5 marks)

b) Explain the put-call parity concept. (5 marks)

c) If a put option trades at a higher price from the value indicated by the put-call parity equation, what action should you take. (5 marks)

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