If a bond portfolio manager specifies liabilities as a benchmark, she is attempting to earn a return that is: A. as high as possible. B. equal to or higher than the return promised to the liability holders. C. the least risky.
The manager that specifies liabilities as a benchmark must ensure that the rate of return earned in the portfolio satisfies the return promised to liability holders. (This objective may be accomplished by earning equal to or higher than the promised return.)
