1. What could you do to protect your bond portfolio against the following kinds of risk?
A. Risk of an increasing interest rate
B. Risk of inflation increasing
C. Risk of volatility in the markets
2. You are starting a new business, and you want to open an office in a local mall. You have been offered two alternative rental arrangements. You can pay the landlord 10% of your sales revenue, or you can pay a fixed fee of $1,000 per month. Describe the circumstances in which each of these arrangements would be your preferred choice.