As interest rates rise, the prices of interest rate futures contracts fall. This is due to the inverse relationship between interest rates and the price of interest rate futures contracts. An investor who has taken a long position in futures contracts stands to lose money if interest rates increase. Therefore, to hedge their portfolio against this risk, an investor should take a short position in interest rate futures contracts. This strategy allows the investor to profit from the falling prices of the futures contracts, thereby offsetting the losses from their long position. This is a common risk management strategy used in derivative trading to protect against adverse price movements.

Choice A is incorrect. This choice suggests that Yu should take a long position in interest futures contracts as the prices will increase. However, this is not correct because when interest rates rise, the prices of interest rate futures contracts typically decrease. Therefore, taking a long position would not be an appropriate strategy to safeguard her position.

Choice B is incorrect. While it correctly states that the prices of interest rate futures contract will decrease with rising interest rates, it incorrectly suggests taking a long position in these contracts. A long position would mean buying more contracts expecting their price to increase which contradicts with the given scenario where we expect prices to fall due to rising interest rates.