Looking at EOC questions/answers for study session 6 in Schweser, book 2.
Question 1 states at the end that you should “Formulate and Justify investment policy objectives for the pension plan … in the following three areas: Return objective, Risk tolerance, Time Horizon”
The answer for part i. return objective is - “The minimum return is the discount rate of 6% with a higher desired return of 7%”
What part of this answer is justifying the objective? I’ve been assuming that the Schweser answers are good to go as example answers but I’m increasingly suspicious that they are just regurgitating the given information and that answers of this form won’t be acceptable come test day.
Anyone else a little further along on their IPS preperation have any thoughts?