If you are trying to wrap text around a graphic and the text does not wrap, but instead leaves a big gap above or below the graphic, then one solution is to:

A) right click Text Wrapping and More Layout Options, click the Picture Position tab, and select Tight.
B) choose Paragraph from the option menu, click Line and Page Breaks tab, and uncheck the Keep lines together option.
C) choose Paragraph from the option menu, click Line and Page Breaks tab, and check the Keep lines together option.
D) right click Text Wrapping and More Layout Options, click the Line and Page Breaks tab, and select Tight.

B