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Price risk is the risk that: 1. the bonds in a dedicated portfolio will decrease in value in response to an increase in interest rates.

Price risk is the risk that:

1.

the bonds in a dedicated portfolio will decrease in value in response to an increase in interest rates.

2.

market prices will increase in value making bonds more expensive to purchase.

3.

the principal amount will not be paid in full.

4.

bond values will change in response to changes in inflation rates.

5.

interest payments will be reinvested at a lower rate than anticipated.

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