Here are the distributions of two different stocks. The stock with the dotted distribution has current price 10. The solid distribution is for the other stock having current price = 20. We will consider the premiums on options for these stocks having exercise price = 12. 0.18 0.16 0.14 0.12 - 0.101 th 0.08 0.06 0.04 0.021 o 25 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 Answer these questions: a. How can we justify/explain why the two normal distributions are centered at the current prices? Explain. b. Compare the call versus put premium values for the stock having the solid distribution (which is higher?). Explain. c. Compare the call premiums on the two stocks (which is higher?). Explain. Note: you can call one the "dotted stock and the other the "solid stock; alternatively, one can be the "lower-variance stock and the other can be the "higher-variance stock just be clear. d. As in "c," compare the put premiums on the two different stocks. Be sure to explain as in "c." Here are the distributions of two different stocks. The stock with the dotted distribution has current price 10. The solid distribution is for the other stock having current price = 20. We will consider the premiums on options for these stocks having exercise price = 12. 0.18 0.16 0.14 0.12 - 0.101 th 0.08 0.06 0.04 0.021 o 25 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 Answer these questions: a. How can we justify/explain why the two normal distributions are centered at the current prices? Explain. b. Compare the call versus put premium values for the stock having the solid distribution (which is higher?). Explain. c. Compare the call premiums on the two stocks (which is higher?). Explain. Note: you can call one the "dotted stock and the other the "solid stock; alternatively, one can be the "lower-variance stock and the other can be the "higher-variance stock just be clear. d. As in "c," compare the put premiums on the two different stocks. Be sure to explain as in "c