Which of the following statements is correct about short-selling?

Short-selling investors sell a stock short when they believe that its price will rise.

*Short-selling investors are obligated to make dividend payments to the investor from whom the stock was borrowed.*

When investors sell short, the premium they pay ensures that they do not have to provide the stock back to the investor from whom it was borrowed.

Counterintuitively, short-selling investors place orders to buy stocks that they do not own.

*why is the second choice the correct answer?*