QUESTION 3 (DERIVATIVE SECURITIES) 1) Melbourne Capital Ltd considers selling European call options on ANZ Bank Ltd for $1.50 per option. The current market price is $17.70 on 28th September 2020, the exercise price is $20, and the maturity of each call option is 6 months. (0) Under what circumstances does the investor make a profit? [2 marks] (ii) Under what circumstances will the option be exercised? [2 marks] How many call options should the investor sell to raise a total capital of $1,260,000? [2 marks]