Final answer:
The portfolio weighted with mortgage-backed securities is most subject to interest rate risk.
Step-by-step explanation:
The portfolio weighted with mortgage-backed securities is most subject to interest rate risk (A). Interest rate risk refers to the potential loss in value that occurs when interest rates rise, leading to a decrease in the market value of fixed-income securities like mortgage-backed securities. As interest rates increase, the value of existing fixed-rate mortgage-backed securities decreases, causing investors to demand higher yields to compensate for the higher interest rate risk. This demonstrates the importance of monitoring interest rate movements when investing in mortgage-backed securities.