You are attempting to formulate an investment strategy. On the one hand, you think there is great upward potential in the stock market and would like to participate in the upward move if it materializes. However, you are not able to afford substantial stock market losses and so cannot run the risk of a stock market collapse, which you think is also a possibility. Your investment adviser suggests a position: Buy shares in a market index stock fund and put options on those shares with 3-month expiration and exercise price of $1,170. The stock index fund is currently selling for $1,350. However, you uncle suggests you instead buy a 3-month call option on the index fund with exercise price $1,260 and buy 3-month T-bills with face value $1,260. (a) On the same graph, draw the payoffs to each of these strategies as a function of the stock fund value in three months. (b) Which strategy must require a greater initial outlay to establish