I have attached a screenshot of the question below:

14. Washington Square Partners (WSP) purchased the US distribution rights for the new movie "Harry Potter XII." WSP expects to pay GBP 10,000,000 in royalties to JKR Holdings in December 2020. The following options on GBP are available maturing in December 2020: Type Strike Price Option Price USD/GBP in USD Call 1.20 0.10 Call 1.25 0.08 Call 1.30 0.06 Put 1.20 0.09 Put 1.25 0.12 Put 1.30 0.15 a. WSP wants to insure that its payments to JKR Holdings cost no more than 12,500,000 USD. What option trade should WSP execute and what cost would they pay? (i) Buy or Sell (circle your answer) (ii) Call or Put (circle your answer) (iii) Total cost of the option in USD b. WSP thinks strategy (a) is very expensive. Would any of the options listed in the table be suitable for creating a collar (or cylinder) option to reduce the cost of WSP's hedging strategy? Describe the trade you would make to create the collar. (i) Buy or Sell (circle your answer) (ii) Call or Put (circle your answer) (iii) Strike price (iv) Total amount for this trade in USD