Graduate Management Admission Test (GMAT) — Questions and Answers

Question 1: A table-analysis question shows 5 departments with headcount: HR=10, Finance=25, IT=40, Sales=60, Ops=15. What percentage of total employees work in IT?

26.7% (Correct answer)
25.0%
26.0%
28.0%

Correct answer: 26.7%

IT has 40 out of 150 total employees (10+25+40+60+15), so 40/150 ≈ 26.7%.

Question 2: How much time is allotted for the AWA section?

30 minutes (Correct answer)
20 minutes
25 minutes
45 minutes

Correct answer: 30 minutes

Test takers are allotted 30 minutes to complete the Analytical Writing Assessment (AWA) section of the GMAT. This time frame requires efficient reading, critical analysis of the provided argument, and structured writing to develop a well-reasoned critique. Effective time management is crucial to ensure a comprehensive and coherent essay within the given limit.

Question 3: In Kotter's eight-step model for leading change, what is the first step?

Create a sense of urgency (Correct answer)
Communicate the vision
Generate short-term wins
Form a guiding coalition

Correct answer: Create a sense of urgency

Kotter argues change starts with establishing urgency so people see why the status quo can't continue.

Question 4: A graphics interpretation question shows that Region A has 1,200 units sold and Region B has 800 units sold. What is the ratio of Region A to Region B sales?

3:2 (Correct answer)
4:3
5:4
2:1

Correct answer: 3:2

1,200:800 simplifies by dividing both by 400 to give 3:2.

Question 5: Which leadership approach best supports performance metrics?

Delegating all responsibilities without oversight
Autocratic decision-making without input
Collaborative leadership that empowers team members and fosters innovation (Correct answer)
Avoiding all difficult decisions

Correct answer: Collaborative leadership that empowers team members and fosters innovation

Collaborative leadership that empowers team members drives engagement, innovation, and better outcomes.

Question 6: Which legislation enacted in 2002 most significantly strengthened corporate governance and financial reporting transparency?

The Dodd-Frank Wall Street Reform Act
The Foreign Corrupt Practices Act
The Sarbanes-Oxley Act (Correct answer)
The Securities Exchange Act of 1934

Correct answer: The Sarbanes-Oxley Act

The Sarbanes-Oxley Act (SOX) was passed in 2002 in direct response to Enron and WorldCom scandals to improve corporate accountability and financial reporting integrity.

Question 7: Which of the following, if true, most weakens: 'Remote work increases productivity, so our company should allow all employees to work remotely'?

Some employees prefer remote work
Remote work reduces commuting stress
Studies show productivity gains of 13% for remote workers
Employees in roles requiring physical presence cannot work remotely (Correct answer)

Correct answer: Employees in roles requiring physical presence cannot work remotely

If many roles require physical presence, the blanket policy of 'all employees' would be impractical, weakening the recommendation.

Question 8: In a multi-source reasoning question, one email states a shipment arrives Friday; a memo says processing takes 2 business days. If Friday is Day 1 of processing, what is the earliest completion day?

Sunday
Saturday
Monday
Tuesday (Correct answer)

Correct answer: Tuesday

Friday is Day 1 and Monday is Day 2 of business processing, so completion is end of Monday — earliest availability is Tuesday.

Question 9: In the RACI matrix, how many people should ideally be 'Accountable' for a given task?

Everyone on the team
None; accountability is shared by the committee
Exactly one (Correct answer)
At least two for redundancy

Correct answer: Exactly one

Having a single accountable person avoids diffusion of responsibility and ensures clear ownership.

Question 10: What is the main strategy for data sufficiency questions?

Estimate the result
Determine if data is enough (Correct answer)
Always use both statements
Guess based on context

Correct answer: Determine if data is enough

The main strategy for Data Sufficiency questions is to determine whether the given statements provide sufficient information to answer the question, rather than actually solving the problem. You must evaluate each statement independently and then together to decide if the data is adequate. This approach saves time by avoiding unnecessary calculations.

Question 11: A two-part analysis asks you to determine if a dataset's median is less than its mean. Given values 2, 3, 3, 4, 18, what is the median?

4
3 (Correct answer)
2
18

Correct answer: 3

When the five values are sorted (2,3,3,4,18), the middle (third) value is 3, which is the median.

Question 12: A leader who puts employees' growth and well-being first and sees leadership as a duty to serve is practicing what?

Laissez-faire leadership
Autocratic leadership
Charismatic leadership
Servant leadership (Correct answer)

Correct answer: Servant leadership

Robert Greenleaf's servant leadership puts serving followers ahead of the leader's own interests.

Question 13: 'Whenever the economy grows, unemployment falls. The economy grew last quarter. Therefore, unemployment fell last quarter.' This is an example of:

Inductive reasoning
False analogy
Valid deductive reasoning (Correct answer)
Circular reasoning

Correct answer: Valid deductive reasoning

The argument follows a valid deductive form (modus ponens): if P then Q; P is true; therefore Q is true.

Question 14: A two-part analysis question presents: If x > 0 and y > 0, and x/y = 0.75, what is y/x?

1.50
0.75
1.33 (Correct answer)
1.25

Correct answer: 1.33

If x/y = 0.75 = 3/4, then y/x = 4/3 ≈ 1.33.

Question 15: Which approach best reflects 'creating shared value' as described by Porter and Kramer?

Lobbying to reduce regulation
Donating a fixed percentage of profits to charity
Minimizing all costs regardless of social impact
Pursuing business strategies that create economic value by addressing societal needs (Correct answer)

Correct answer: Pursuing business strategies that create economic value by addressing societal needs

Shared value links company success with social progress by redesigning products, value chains, or local clusters.

Question 16: What risk management principle applies to strategic planning?

Ignore risks until they become problems
Transfer all risks to insurance
Proactively identify, assess, and mitigate risks through a structured framework (Correct answer)
Accept all risks without analysis

Correct answer: Proactively identify, assess, and mitigate risks through a structured framework

Proactive risk management through structured identification, assessment, and mitigation is essential for business continuity.

Question 17: How should performance be measured in strategic planning?

Using balanced scorecards with multiple key performance indicators (Correct answer)
Measuring only when problems arise
Using a single financial metric
Relying on subjective impressions

Correct answer: Using balanced scorecards with multiple key performance indicators

Balanced scorecards with multiple KPIs provide a comprehensive view of performance across financial, customer, process, and learning dimensions.

Question 18: A GMAC Data Insights scatter plot shows a strong positive correlation between advertising spend and sales. Which conclusion is best supported?

Higher ad spend is associated with higher sales (Correct answer)
Higher ad spend causes higher sales
The data proves a causal relationship
Lower sales cause lower ad spend

Correct answer: Higher ad spend is associated with higher sales

Correlation shown in a scatter plot indicates association, not causation.

Question 19: In a GMAC Data Insights question, a table shows that Company A's revenue grew from $2M to $3M while Company B's grew from $5M to $7M. Which company had the higher percentage growth?

Company B
Both grew equally
Cannot be determined
Company A (Correct answer)

Correct answer: Company A

Company A grew 50% ($2M to $3M) while Company B grew 40% ($5M to $7M), making Company A's percentage growth higher.

Question 20: Midway through a project, a new executive sponsor is appointed. What should the project manager do first regarding stakeholders?

Continue the existing communication plan unchanged
Freeze all project work until the sponsor signs off
Reassess the stakeholder register and engagement strategy (Correct answer)
Ask the previous sponsor to remain informally in charge

Correct answer: Reassess the stakeholder register and engagement strategy

Stakeholder identification and analysis are iterative and must be revisited when key stakeholders change.

Question 21: An argument concludes that a new drug is safe because no side effects appeared in a 2-week trial. The biggest flaw in this reasoning is:

Side effects were self-reported
The drug company funded the study
The trial was too short to detect long-term side effects (Correct answer)
No placebo group was used

Correct answer: The trial was too short to detect long-term side effects

Two weeks is insufficient to identify long-term or delayed side effects, making the safety conclusion premature.

Question 22: In a GMAC data sufficiency-style question: Is integer n divisible by 6? Statement 1: n is divisible by 3. Statement 2: n is divisible by 2. Are the two statements together sufficient?

Yes, together they are sufficient (Correct answer)
Statement 2 alone is sufficient
Statement 1 alone is sufficient
No, neither alone is sufficient

Correct answer: Yes, together they are sufficient

Divisibility by both 2 and 3 is necessary and sufficient for divisibility by 6.

Question 23: Which of the following best describes a 'latent' stakeholder?

A stakeholder with all three salience attributes
A stakeholder who is actively supportive
A stakeholder possessing only one salience attribute (Correct answer)
A stakeholder who has left the organization

Correct answer: A stakeholder possessing only one salience attribute

Latent stakeholders—dormant, discretionary, or demanding—hold only one of power, legitimacy, or urgency.

Question 24: How does ethical decision-making apply to financial analysis?

Following the law is sufficient without ethical consideration
Ethics apply only to public-facing decisions
Ethics are irrelevant in business
All decisions should consider legal compliance, stakeholder impact, and organizational values (Correct answer)

Correct answer: All decisions should consider legal compliance, stakeholder impact, and organizational values

Ethical decision-making requires considering legal compliance, stakeholder impact, and alignment with organizational values.

Question 25: Which leadership approach best supports strategic planning?

Delegating all responsibilities without oversight
Autocratic decision-making without input
Collaborative leadership that empowers team members and fosters innovation (Correct answer)
Avoiding all difficult decisions

Correct answer: Collaborative leadership that empowers team members and fosters innovation

Collaborative leadership that empowers team members drives engagement, innovation, and better outcomes.

Question 26: How should performance be measured in risk management?

Using a single financial metric
Measuring only when problems arise
Using balanced scorecards with multiple key performance indicators (Correct answer)
Relying on subjective impressions

Correct answer: Using balanced scorecards with multiple key performance indicators

Balanced scorecards with multiple KPIs provide a comprehensive view of performance across financial, customer, process, and learning dimensions.

Question 27: How does ethical decision-making apply to process improvement?

Following the law is sufficient without ethical consideration
All decisions should consider legal compliance, stakeholder impact, and organizational values (Correct answer)
Ethics apply only to public-facing decisions
Ethics are irrelevant in business

Correct answer: All decisions should consider legal compliance, stakeholder impact, and organizational values

Ethical decision-making requires considering legal compliance, stakeholder impact, and alignment with organizational values.

Question 28: In a power/interest grid, how should a project manager treat a stakeholder with high power but low interest?

Manage closely with frequent detailed updates
Keep informed through regular newsletters only
Monitor with minimal effort
Keep satisfied without overloading them with information (Correct answer)

Correct answer: Keep satisfied without overloading them with information

High-power, low-interest stakeholders should be kept satisfied so their latent influence does not turn against the project.

Question 29: Which type of writing task is required in the AWA section?

Persuasive letter
Descriptive story
Narrative essay
Argument essay (Correct answer)

Correct answer: Argument essay

The AWA section of the GMAT requires test takers to write an "Analysis of an Argument" essay. In this task, candidates are presented with a short argument and must critically analyze its reasoning, identifying flaws, assumptions, and potential weaknesses. They are not asked to present their own opinion on the topic, but rather to evaluate the logical soundness of the given argument.

Question 30: When are most MBA application deadlines?

Throughout the year in rounds (Correct answer)
Only in summer
January only
Every week

Correct answer: Throughout the year in rounds

Most MBA programs utilize a 'rounds' system for applications, with multiple deadlines spread across the academic year (e.g., Round 1 in fall, Round 2 in winter, Round 3 in spring). This allows applicants flexibility in submitting their materials and gives admissions committees time to review applications thoroughly. While specific dates vary by school, applications are generally accepted in distinct periods rather than continuously or only at one time.

Question 31: In a GMAT inference question, which answer choice is most directly supported by the following: 'All GMAT test-takers who score above 700 are admitted to at least one top-10 MBA program'?

Scoring above 700 is the only admission requirement
A test-taker admitted to a top-10 program scored above 700
A test-taker who scored 710 was admitted to at least one top-10 program (Correct answer)
Top-10 programs only accept GMAT scores above 700

Correct answer: A test-taker who scored 710 was admitted to at least one top-10 program

The statement guarantees that any score above 700 leads to admission; 710 > 700, so that person was admitted.

Question 32: A plant runs 480 minutes per day and customer demand is 160 units per day. What is the takt time?

160 minutes per unit
3 minutes per unit (Correct answer)
0.33 minutes per unit
480 minutes per unit

Correct answer: 3 minutes per unit

Takt time = 480 / 160 = 3 minutes per unit.

Question 33: A board of directors primarily represents which stakeholder group's interests under U.S. corporate governance?

Customers
Suppliers
Local governments
Shareholders (Correct answer)

Correct answer: Shareholders

Directors owe fiduciary duties of care and loyalty primarily to the corporation and its shareholders.

Question 34: Which leadership approach best supports process improvement?

Avoiding all difficult decisions
Autocratic decision-making without input
Collaborative leadership that empowers team members and fosters innovation (Correct answer)
Delegating all responsibilities without oversight

Correct answer: Collaborative leadership that empowers team members and fosters innovation

Collaborative leadership that empowers team members drives engagement, innovation, and better outcomes.

Question 35: Which of the following best describes a 'poison pill' defense strategy in corporate governance?

A legal strategy to sue activist shareholders for interference
A mechanism that makes a hostile takeover prohibitively expensive for the acquirer (Correct answer)
A policy preventing employees from disclosing confidential salary data
A strategy to poach top talent from competing firms

Correct answer: A mechanism that makes a hostile takeover prohibitively expensive for the acquirer

A poison pill is a shareholder rights plan that allows existing shareholders to buy additional shares at a steep discount if a hostile party acquires a threshold stake, diluting the acquirer.

Question 36: What is the first step in the business school admissions process?

Schedule your interview
Research programs and requirements (Correct answer)
Request recommendations
Submit your GMAT scores

Correct answer: Research programs and requirements

The first and most crucial step in the business school admissions process is to thoroughly research programs and their specific requirements. This helps you identify schools that align with your career goals and ensures you meet all necessary prerequisites before investing time in applications, GMAT preparation, or interviews. Proper research lays the foundation for a successful application.

Question 37: A GMAC graph shows sales data for Q1–Q4. Q1=$10K, Q2=$15K, Q3=$12K, Q4=$18K. What is the average quarterly sales?

$15,000
$14,000
$13,500
$13,750 (Correct answer)

Correct answer: $13,750

Average = (10+15+12+18)/4 = 55/4 = $13,750.

Question 38: What is the typical duration of an MBA program?

6 months
2 years (Correct answer)
4 years
1 year

Correct answer: 2 years

The traditional full-time MBA program in the United States and many other countries is designed to be completed over two academic years. This duration allows students to gain a comprehensive understanding of business fundamentals, specialize in areas of interest, and often complete an internship between their first and second years. While one-year and executive MBA programs exist, two years is the most common and widely recognized duration for a full-time MBA.

Question 39: A two-part analysis question: A company's costs increased 20% and revenue increased 25%. If original profit margin was 10%, did the absolute profit increase?

No, it decreased
Yes, it increased (Correct answer)
Cannot be determined without exact figures
It stayed the same

Correct answer: Yes, it increased

With proportional increases where revenue grows faster than costs, absolute profit increases.

Question 40: A two-part analysis asks: If the probability of Event A is 0.4 and Event B is 0.5, and they are independent, what is P(A and B)?

0.10
0.20 (Correct answer)
0.45
0.90

Correct answer: 0.20

For independent events, P(A and B) = P(A) × P(B) = 0.4 × 0.5 = 0.20.

Question 41: In a multi-source reasoning question, Source 1 says a product has 20% market share, Source 2 says the total market is $500M. What is the product's estimated market value?

$200M
$25M
$50M
$100M (Correct answer)

Correct answer: $100M

20% of $500M = 0.20 × $500M = $100M.

Question 42: How should performance be measured in business ethics?

Using a single financial metric
Measuring only when problems arise
Relying on subjective impressions
Using balanced scorecards with multiple key performance indicators (Correct answer)

Correct answer: Using balanced scorecards with multiple key performance indicators

Balanced scorecards with multiple KPIs provide a comprehensive view of performance across financial, customer, process, and learning dimensions.

Question 43: A GMAT Critical Reasoning argument states: 'All employees who meet their targets receive bonuses. Jane received a bonus.' Which conclusion is valid?

Jane is the top performer
Jane met her targets
Jane may or may not have met her targets (Correct answer)
Jane exceeded her targets

Correct answer: Jane may or may not have met her targets

The argument does not state that bonuses are given ONLY to employees who meet targets, so Jane could have received a bonus for another reason.

Question 44: What is the primary purpose of the Analytical Writing Assessment (AWA)?

To test vocabulary knowledge
To assess mathematical reasoning
To check memorization
To evaluate analytical writing skills (Correct answer)

Correct answer: To evaluate analytical writing skills

The primary purpose of the Analytical Writing Assessment (AWA) section of the GMAT is to evaluate a test taker's ability to think critically and communicate complex ideas effectively in written English. It specifically assesses how well one can analyze an argument, articulate a critique, and support it with relevant examples and explanations. This section is not designed to test mathematical reasoning, vocabulary, or memorization.

Question 45: What communication strategy is most effective for process improvement?

Use technical jargon to demonstrate expertise
Limit communication to written memos only
Maintain transparent, timely, and audience-appropriate communication (Correct answer)
Communicate only when required by policy

Correct answer: Maintain transparent, timely, and audience-appropriate communication

Transparent, timely, and audience-appropriate communication builds trust and ensures alignment among stakeholders.

Question 46: A GMAC table shows 4 product lines with the following net margins: P1=8%, P2=12%, P3=5%, P4=15%. Which has the highest net margin?

P3
P4 (Correct answer)
P1
P2

Correct answer: P4

Comparing 8%, 12%, 5%, and 15%, the highest is P4 at 15%.

Question 47: How should performance be measured in performance metrics?

Using balanced scorecards with multiple key performance indicators (Correct answer)
Measuring only when problems arise
Using a single financial metric
Relying on subjective impressions

Correct answer: Using balanced scorecards with multiple key performance indicators

Balanced scorecards with multiple KPIs provide a comprehensive view of performance across financial, customer, process, and learning dimensions.

Question 48: What does 'takt time' represent in a production process?

The time a unit spends waiting in queue
Total processing time across all steps
The time needed to change over a machine
The pace of production needed to match customer demand (Correct answer)

Correct answer: The pace of production needed to match customer demand

Takt time equals available production time divided by customer demand.

Question 49: A Data Insights question asks: A store's profit margin is 15% and its revenue is $80,000. What is the profit?

$10,000
$15,000
$8,000
$12,000 (Correct answer)

Correct answer: $12,000

Profit = 15% × $80,000 = 0.15 × $80,000 = $12,000.

Question 50: Which of the following is most important when analyzing an argument?

Quoting the entire argument
Stating personal opinion
Identifying logical flaws (Correct answer)
Memorizing the argument

Correct answer: Identifying logical flaws

When analyzing an argument for the AWA section, the most important task is to identify and explain the logical flaws, unstated assumptions, and weaknesses in the author's reasoning. The goal is not to agree or disagree with the argument's conclusion, but to critically evaluate how well the author supports their claims. This demonstrates analytical thinking and the ability to dissect an argument's structure.

Question 51: What is one benefit of mastering the verbal section?

Faster reading only
Stronger accent
Improved logical thinking and communication (Correct answer)
Better grammar in texts

Correct answer: Improved logical thinking and communication

Mastering the Verbal section, particularly Critical Reasoning and Reading Comprehension, significantly improves logical thinking and communication skills. These sections require analyzing arguments, understanding complex texts, and identifying underlying assumptions, which are critical for effective decision-making and conveying ideas clearly in a business context. It enhances your ability to process and articulate information.

Question 52: In a GMAC graphics interpretation question, a pie chart shows that 35% of costs are labor. If total costs are $200,000, how much is spent on labor?

$70,000 (Correct answer)
$65,000
$60,000
$75,000

Correct answer: $70,000

35% of $200,000 = 0.35 × $200,000 = $70,000.

Question 53: Why is work experience important for MBA admissions?

To enhance career transition (Correct answer)
To meet age requirements
To shorten the program
To skip the GMAT

Correct answer: To enhance career transition

Work experience is crucial for MBA admissions because it demonstrates an applicant's practical business understanding, leadership potential, and ability to contribute to classroom discussions. It helps students leverage the MBA curriculum to pivot into new industries or roles, as the program builds upon existing professional foundations rather than starting from scratch. This experience is vital for making a successful career transition post-MBA.

Question 54: Which of Schein's levels of organizational culture is the most deeply embedded and hardest to observe?

Espoused values
Formal policies
Artifacts
Basic underlying assumptions (Correct answer)

Correct answer: Basic underlying assumptions

Basic underlying assumptions are unconscious, taken-for-granted beliefs at the core of a culture.

Question 55: What is the primary objective of process improvement in professional practice?

Following competitor strategies exactly
Maximizing short-term profits only
Creating sustainable value for all stakeholders (Correct answer)
Eliminating all business risks

Correct answer: Creating sustainable value for all stakeholders

Process Improvement aims to create sustainable value for all stakeholders including customers, employees, shareholders, and the community.

Question 56: Lewin's three-stage change model consists of which sequence?

Plan, do, check
Unfreeze, change, refreeze (Correct answer)
Diagnose, intervene, evaluate
Forming, storming, norming

Correct answer: Unfreeze, change, refreeze

Lewin described change as unfreezing current behaviors, moving to new ones, and refreezing them.

Question 57: Which of the following is an example of an internal stakeholder?

A competitor
A local community group
An employee of the firm (Correct answer)
A regulatory agency

Correct answer: An employee of the firm

Internal stakeholders are members of the organization, such as employees and managers.

Question 58: What is one way to strengthen your AWA essay?

Suggest alternative explanations (Correct answer)
Ignore counterarguments
Use long quotes
Repeat the prompt

Correct answer: Suggest alternative explanations

Suggesting alternative explanations is a powerful way to strengthen your AWA essay because it demonstrates critical thinking and the ability to identify potential flaws in the original argument. By offering other plausible causes or interpretations for the evidence presented, you effectively weaken the argument's conclusion and highlight its unstated assumptions. This analytical depth is key to a high score.

Question 59: What communication strategy is most effective for stakeholder management?

Limit communication to written memos only
Communicate only when required by policy
Use technical jargon to demonstrate expertise
Maintain transparent, timely, and audience-appropriate communication (Correct answer)

Correct answer: Maintain transparent, timely, and audience-appropriate communication

Transparent, timely, and audience-appropriate communication builds trust and ensures alignment among stakeholders.

Question 60: Which leadership approach best supports stakeholder management?

Delegating all responsibilities without oversight
Avoiding all difficult decisions
Autocratic decision-making without input
Collaborative leadership that empowers team members and fosters innovation (Correct answer)

Correct answer: Collaborative leadership that empowers team members and fosters innovation

Collaborative leadership that empowers team members drives engagement, innovation, and better outcomes.

Question 61: When two key stakeholders have conflicting requirements, what is generally the most effective first step?

Adopt the requirement of the more senior stakeholder
Escalate immediately to the board
Drop both requirements from scope
Facilitate a discussion to surface underlying interests (Correct answer)

Correct answer: Facilitate a discussion to surface underlying interests

Exploring underlying interests often reveals solutions that satisfy both parties, consistent with principled negotiation.

Question 62: What communication strategy is most effective for financial analysis?

Use technical jargon to demonstrate expertise
Maintain transparent, timely, and audience-appropriate communication (Correct answer)
Communicate only when required by policy
Limit communication to written memos only

Correct answer: Maintain transparent, timely, and audience-appropriate communication

Transparent, timely, and audience-appropriate communication builds trust and ensures alignment among stakeholders.

Question 63: What does the GMAT score represent in an MBA application?

Work experience
Extracurricular involvement
Interview skills
Academic aptitude (Correct answer)

Correct answer: Academic aptitude

The GMAT score represents a candidate's academic aptitude, specifically their analytical, quantitative, verbal, and integrated reasoning skills. Business schools use it as a standardized measure to assess an applicant's readiness for the rigorous academic demands of an MBA program. It provides an objective indicator of your potential to succeed in a graduate-level business curriculum.

Question 64: A pull system such as kanban primarily aims to do which of the following?

Produce only in response to actual downstream demand (Correct answer)
Maximize utilization of every machine
Schedule production from long-range forecasts
Build large safety stocks

Correct answer: Produce only in response to actual downstream demand

Kanban triggers production only when downstream consumption signals a need, limiting inventory.

Question 65: Which tool visually maps stakeholders along axes of influence and impact to prioritize engagement?

Gantt chart
Influence/impact grid (Correct answer)
Fishbone diagram
Pareto chart

Correct answer: Influence/impact grid

An influence/impact grid classifies stakeholders by their ability to affect the project and the project's effect on them.

Question 66: Freeman's stakeholder theory most directly challenges which traditional view of the corporation?

That managers owe duties primarily to shareholders (Correct answer)
That firms should pay taxes
That employees should be unionized
That firms should diversify product lines

Correct answer: That managers owe duties primarily to shareholders

Freeman argued managers must balance the interests of all groups affecting or affected by the firm, not just shareholders.

Question 67: A multi-source reasoning passage states a project is 60% complete after 9 months. At this rate, how many total months will the project take?

14 months
15 months (Correct answer)
18 months
12 months

Correct answer: 15 months

If 60% takes 9 months, then 100% takes 9/0.60 = 15 months.

Question 68: Which DMAIC phase focuses on confirming root causes through data analysis?

Analyze (Correct answer)
Define
Measure
Control

Correct answer: Analyze

The Analyze phase uses data to identify and verify the root causes of defects.

Question 69: Which leadership approach best supports financial analysis?

Avoiding all difficult decisions
Delegating all responsibilities without oversight
Autocratic decision-making without input
Collaborative leadership that empowers team members and fosters innovation (Correct answer)

Correct answer: Collaborative leadership that empowers team members and fosters innovation

Collaborative leadership that empowers team members drives engagement, innovation, and better outcomes.

Question 70: In stakeholder negotiations, what does BATNA stand for?

Balanced Approach To Negotiated Arbitration
Best Alternative To a Negotiated Agreement (Correct answer)
Basic Agreement Terms for New Alliances
Bilateral Arrangement To Navigate Accords

Correct answer: Best Alternative To a Negotiated Agreement

BATNA is the best option a party has if negotiations fail, which sets their walk-away point.

Question 71: A GMAC Data Insights question shows a bar chart where sales increased by 10% each year for 3 years starting at $100K. What are sales in year 3?

$110,000
$133,100 (Correct answer)
$121,000
$130,000

Correct answer: $133,100

Year 1: $110K, Year 2: $121K, Year 3: $133,100 after compounding 10% annually three times.

Question 72: On a control chart, a single point falling outside the upper control limit most likely signals what?

Common-cause variation
Normal random noise
A capable process
Special-cause variation (Correct answer)

Correct answer: Special-cause variation

Points beyond control limits indicate an assignable, special cause that should be investigated.

Question 73: What is the primary objective of organizational leadership in professional practice?

Eliminating all business risks
Maximizing short-term profits only
Following competitor strategies exactly
Creating sustainable value for all stakeholders (Correct answer)

Correct answer: Creating sustainable value for all stakeholders

Organizational Leadership aims to create sustainable value for all stakeholders including customers, employees, shareholders, and the community.

Question 74: Which skill is tested by critical reasoning questions?

Basic math
Grammar rules
Logical evaluation (Correct answer)
Reading fluency

Correct answer: Logical evaluation

Critical Reasoning questions in the Verbal section specifically test your ability to logically evaluate arguments. This involves identifying assumptions, drawing inferences, assessing the strength or weakness of conclusions, and understanding the structure of short passages. It measures your capacity for analytical and logical thought, crucial for business decision-making.

Question 75: How does ethical decision-making apply to stakeholder management?

All decisions should consider legal compliance, stakeholder impact, and organizational values (Correct answer)
Following the law is sufficient without ethical consideration
Ethics apply only to public-facing decisions
Ethics are irrelevant in business

Correct answer: All decisions should consider legal compliance, stakeholder impact, and organizational values

Ethical decision-making requires considering legal compliance, stakeholder impact, and alignment with organizational values.

Question 76: A project manager notices a key stakeholder repeatedly skipping status meetings. What is the best response?

Meet one-on-one to understand their needs and adjust engagement (Correct answer)
Report the stakeholder to their supervisor
Remove the stakeholder from the distribution list
Assume silence means approval

Correct answer: Meet one-on-one to understand their needs and adjust engagement

Disengagement is a signal to investigate needs and tailor engagement rather than assume consent.

Question 77: What is the primary purpose of a stakeholder communication plan?

To list all project risks and their responses
To estimate project costs
To define project tasks and dependencies
To specify what information is delivered to whom, when, and how (Correct answer)

Correct answer: To specify what information is delivered to whom, when, and how

A communication plan defines the content, audience, frequency, and channel of stakeholder communications.

Question 78: In a table analysis, you sort by 'profit margin' descending. Company X has revenue $500K and costs $425K. What is its profit margin?

17%
16%
14%
15% (Correct answer)

Correct answer: 15%

Profit = $500K − $425K = $75K; margin = $75K/$500K = 15%.

Question 79: Which of the following is crucial for sentence correction questions?

Grammar and clarity (Correct answer)
Creativity
Speed
Spelling

Correct answer: Grammar and clarity

For Sentence Correction questions, grammar and clarity are crucial. These questions test your mastery of standard written English, focusing on grammatical rules, proper syntax, idiomatic expressions, and logical precision. The goal is to choose the option that expresses the idea most clearly, concisely, and correctly according to standard English conventions.

Graduate Management Admission Test (GMAT)

The GMAT is a standardized exam designed to assess analytical, writing, quantitative, verbal, and reading skills for admission to graduate management programs.

Questions

135 min

Time Limit

50%

To Pass

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Exam Rules

You can skip questions and return to them later
Flag questions for review before submitting
No feedback shown until you submit the entire exam
Unanswered questions count as wrong — answer everything
10 pretest questions are mixed in and don't affect your score
Timer auto-submits when time runs out
Your progress is auto-saved every 30 seconds

These practice questions were written with AI tools. They are not real exam questions. Exam facts are checked against the official sources listed below. Not reviewed by a subject-matter expert. Editorial policy

Sources & references

Exam facts on this page (fees, format, dates, passing scores) are checked against these official sources; the date is our last check. Editorial policy

mba.com — Passing score, score validity, retake policy, exam format, test delivery, fees, test dates, eligibility · verified Oct 2026