Explain the difference between call and put options. Does the buyer or the seller of an option pay the option premium? Why does the seller of an option take on the risk? Explain how an investor could...

Explain the difference between call and put options. Does the buyer or the seller of an option pay the option premium? Why does the seller of an option take on the risk?

Explain how an investor could use a stock index future to hedge the risk of a fall in stock prices.