Explanation:

Short Forward Position:

• A short forward position means you have agreed to sell the underlying asset at a predetermined price (forward price) at a future date.
• If the price of the underlying decreases below the forward price, you can buy the asset at the lower market price and sell it at the higher forward price, resulting in a gain.
• Therefore, a short forward position gains when the underlying price decreases.

Short Call Option Position:

• A short call option position means you have sold (written) a call option, giving the buyer the right to buy the underlying from you at the strike price.
• When you sell a call option, you receive a premium upfront.
• If the price of the underlying decreases, the call option becomes less likely to be exercised (since the buyer wouldn't want to buy at a strike price higher than the market price).
• The option may expire worthless, allowing you to keep the entire premium as profit.
• Therefore, a short call option position also gains when the underlying price decreases.

Conclusion: Both positions benefit from a decrease in the underlying asset's price, making option C the correct answer.