Are you asking about #41 actually?
B.
You buy a put. Put strike at 4.0 makes the put cheaper -> collar cheaper
You sell a call. Call strike at 6.5 makes the call cheaper -> collar more expensive
Correct answer:A
You buy a put. Put strike at 4.0 makes the put cheaper -> collar cheaper
You sell a call. Call strike at 5.5 makes the call more expensive cuz its more likely to be ITM -> since you sell the Call, you get more money and the collar is cheaper |