2010 CFAi AM Q7B

Part III of 7B says that a zero cost collar would lose a limited amount of money if the UK loses the bid and would make only a limited profit if the UK wins the bid. Wouldn’t this only be the case if you owned the underlying as well (which the question does not specify?)

If you are short a call and the price rises sharply, without owning the underlying your loss is potentially infinite on a rise in price, correct?

What am I missing here?

To mimic a collar without owning the underlying, couldn’t you just buy a call at the low strike, and sell a call at the high strike? That way the payoff is still: ____ ___/