You chose B

You have put your money in a checking account and will receive an income which will vary as interest rates vary.  The next day interest rates move to 5% and so your income is reduced from £10k per year to £5k per year.

Context – You have retired and operate on a very strict budget.

With the additional £10k per year you can just about afford to maintain your current lifestyle.

Now you only have £5k per year to supplement your pension you are going to have to make some severe cutbacks.

You really should have managed your risk better.

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