GMAT –QUESTIONS AND CORRECT ANSWERS (VERIFIED ANSWERS) PLUS
RATIONALES 2026 Q&A | INSTANT DOWNLOAD PDF.
Core Domains
Quantitative Reasoning: Problem Solving
Quantitative Reasoning: Data Sufficiency
Verbal Reasoning: Critical Reasoning
Verbal Reasoning: Reading Comprehension
Verbal Reasoning: Sentence Correction
Data Insights: Data Sufficiency
Data Insights: Multi-Source Reasoning
Data Insights: Table Analysis & Graphics Interpretation
Business Ethics and Professional Standards
Analytical Writing and Critical Thinking Analysis*
,The Graduate Management Admission Test is designed to assess advanced
analytical, quantitative, verbal, and data literacy skills essential for success in
graduate-level business and management programs. This comprehensive
assessment evaluates foundational theory alongside applied professional knowledge,
requiring candidates to navigate complex scenarios, regulatory and legal frameworks,
and ethical dilemmas. Structuring evaluations through multi-choice and case-based
problems, the exam emphasizes critical thinking, data interpretation, and strategic
decision-making in real-world business contexts. Candidates must demonstrate
rigorous problem-solving capabilities, precise textual analysis, and the quantitative
agility necessary to excel in dynamic global corporate environments.
Section One: Questions 1–100
Question 1
A company increases the price of its primary product by 20%. Following this change,
the total revenue generated from the product decreases by 4%. By what percentage
did the quantity of the product sold decrease?
A. 16%
B. 20%
,C. 24%
D. 25%
🟢 D. 25%
🔴 RATIONALE: Revenue equals price multiplied by quantity (R = P × Q). Let the
initial price be 1 and initial quantity be 1, making initial revenue 1. The new price is
1.20 and the new revenue is 0.96. The new quantity is 0.96/1.20 = 0.80. A decrease
from 1 to 0.80 represents a 25% reduction in quantity sold.
Question 2
An investment analyst is reviewing a portfolio containing municipal bonds. If a capital
gains tax rate of 15% applies to all profits over $10,000, and a portfolio manager fails
to disclose a conflict of interest while executing a trade that clears this threshold,
which ethical standard is primarily violated under global investment compliance
codes?
A. Professional Independence
B. Integrity of Capital Markets
C. Duty to Clients
D. Misconduct
, 🟢 C. Duty to Clients
🔴 RATIONALE: Failing to disclose a conflict of interest directly compromises the
fiduciary duty owed to the client. Investment professionals must place client interests
above their own and provide full transparency regarding any factors that could
influence objectivity.
Question 3
Company X experienced a sudden 15% drop in quarterly sales. The CEO claims that
a new competitor entering the market is the sole cause of this decline. Which of the
following, if true, most seriously weakens the CEO's claim?
A. The new competitor's products are priced significantly higher than Company X's
products.
B. Total market demand for the product category decreased by 20% during the same
quarter due to economic downturn.
C. Company X reduced its marketing budget by 5% at the beginning of the quarter.
D. The competitor launched its product line two weeks later than originally scheduled.
🟢 B. Total market demand for the product category decreased by 20% during the
same quarter due to economic downturn.
RATIONALES 2026 Q&A | INSTANT DOWNLOAD PDF.
Core Domains
Quantitative Reasoning: Problem Solving
Quantitative Reasoning: Data Sufficiency
Verbal Reasoning: Critical Reasoning
Verbal Reasoning: Reading Comprehension
Verbal Reasoning: Sentence Correction
Data Insights: Data Sufficiency
Data Insights: Multi-Source Reasoning
Data Insights: Table Analysis & Graphics Interpretation
Business Ethics and Professional Standards
Analytical Writing and Critical Thinking Analysis*
,The Graduate Management Admission Test is designed to assess advanced
analytical, quantitative, verbal, and data literacy skills essential for success in
graduate-level business and management programs. This comprehensive
assessment evaluates foundational theory alongside applied professional knowledge,
requiring candidates to navigate complex scenarios, regulatory and legal frameworks,
and ethical dilemmas. Structuring evaluations through multi-choice and case-based
problems, the exam emphasizes critical thinking, data interpretation, and strategic
decision-making in real-world business contexts. Candidates must demonstrate
rigorous problem-solving capabilities, precise textual analysis, and the quantitative
agility necessary to excel in dynamic global corporate environments.
Section One: Questions 1–100
Question 1
A company increases the price of its primary product by 20%. Following this change,
the total revenue generated from the product decreases by 4%. By what percentage
did the quantity of the product sold decrease?
A. 16%
B. 20%
,C. 24%
D. 25%
🟢 D. 25%
🔴 RATIONALE: Revenue equals price multiplied by quantity (R = P × Q). Let the
initial price be 1 and initial quantity be 1, making initial revenue 1. The new price is
1.20 and the new revenue is 0.96. The new quantity is 0.96/1.20 = 0.80. A decrease
from 1 to 0.80 represents a 25% reduction in quantity sold.
Question 2
An investment analyst is reviewing a portfolio containing municipal bonds. If a capital
gains tax rate of 15% applies to all profits over $10,000, and a portfolio manager fails
to disclose a conflict of interest while executing a trade that clears this threshold,
which ethical standard is primarily violated under global investment compliance
codes?
A. Professional Independence
B. Integrity of Capital Markets
C. Duty to Clients
D. Misconduct
, 🟢 C. Duty to Clients
🔴 RATIONALE: Failing to disclose a conflict of interest directly compromises the
fiduciary duty owed to the client. Investment professionals must place client interests
above their own and provide full transparency regarding any factors that could
influence objectivity.
Question 3
Company X experienced a sudden 15% drop in quarterly sales. The CEO claims that
a new competitor entering the market is the sole cause of this decline. Which of the
following, if true, most seriously weakens the CEO's claim?
A. The new competitor's products are priced significantly higher than Company X's
products.
B. Total market demand for the product category decreased by 20% during the same
quarter due to economic downturn.
C. Company X reduced its marketing budget by 5% at the beginning of the quarter.
D. The competitor launched its product line two weeks later than originally scheduled.
🟢 B. Total market demand for the product category decreased by 20% during the
same quarter due to economic downturn.
