XAT Practice Set 1

Behavioural economists have shown that people often overweight small probabilities, which is why lottery tickets and travel insurance both find eager buyers despite unfavourable expected values. The passage suggests that people buy lottery tickets and travel insurance because they:

1. A.Correctly calculate expected value
2. B.Overestimate the likelihood of rare events✓
3. C.Ignore probability altogether
4. D.Prefer certain losses to uncertain gains

Correct answer: B

The doctrine of comparative advantage holds that even if one country is more efficient at producing every good than another, both countries can still gain from trade by specialising in the good for which their relative efficiency is greatest. Which of the following best captures the doctrine described?

1. A.A country should only trade if it has an absolute advantage
2. B.Mutual gains from trade can exist even without absolute efficiency advantages✓
3. C.Specialisation benefits only the more efficient country
4. D.Trade is beneficial only between countries of similar efficiency

Correct answer: B

Choose the word most nearly OPPOSITE in meaning to 'PARSIMONIOUS':

1. A.Frugal
2. B.Lavish✓
3. C.Stingy
4. D.Thrifty

Correct answer: B

Choose the word most nearly SIMILAR in meaning to 'EPHEMERAL':

1. A.Permanent
2. B.Transient✓
3. C.Eternal
4. D.Robust

Correct answer: B

Choose the grammatically correct sentence:

1. A.Neither of the applicants were qualified for the position
2. B.Neither of the applicants was qualified for the position✓
3. C.Neither of the applicant were qualified for the position
4. D.Neither of the applicants have been qualified for the position

Correct answer: B

Arrange sentences 1-4 into a coherent paragraph: 1. As a result, many central banks now favour a series of smaller, incremental rate changes. 2. Sudden large interest rate hikes can shock financial markets and disrupt investor confidence. 3. This gradualist approach seeks to correct inflation without triggering a recession. 4. Central banks must balance the need to control inflation with the risk of destabilising markets.

1. A.4-2-1-3✓
2. B.2-4-3-1
3. C.4-1-2-3
4. D.2-1-4-3

Correct answer: A

Argument: 'The government should not subsidise electric vehicles because subsidies distort the free market.' Which of the following, if true, most strengthens this argument?

1. A.Electric vehicles produce zero tailpipe emissions
2. B.Historical subsidy programmes for other technologies have often continued long after they were needed, propping up inefficient firms and delaying genuine cost competitiveness✓
3. C.Electric vehicle sales have grown steadily over the past five years without subsidy in some markets
4. D.Government subsidies are funded by taxpayers

Correct answer: B

Five people are ranked strictly by height as P > Q > R > S > T (P is tallest). Who is taller than exactly two people and shorter than exactly two people?

1. A.Q
2. B.R✓
3. C.S
4. D.P

Correct answer: B

Statements: All managers are leaders. Some leaders are decisive. Conclusions: I. Some managers are decisive. II. All leaders are managers. Which conclusion(s) follow logically?

1. A.Only I follows
2. B.Only II follows
3. C.Both follow
4. D.Neither I nor II follows✓

Correct answer: D

In a certain code, 'TRAIN' is written as 'USBJO'. How is 'PLANE' written in that code?

1. A.QMBOF✓
2. B.QNBOF
3. C.PMBOF
4. D.QMBOE

Correct answer: A

What is the angle between the hour hand and the minute hand of a clock at 3:40?

1. A.120°
2. B.130°✓
3. C.140°
4. D.110°

Correct answer: B

As a manager, you discover that a close friend and colleague has been consistently submitting inflated expense reports, though the amounts are small. Which response best reflects sound ethical judgement in a professional setting?

1. A.Ignore it since the amounts are small and he is a friend
2. B.Report the discrepancy through proper channels while giving him an opportunity to explain, treating the matter with the same standard applied to any employee✓
3. C.Confront him privately and ask him to pay you back personally
4. D.Say nothing but exclude him from future projects as informal punishment

Correct answer: B

A project team is only mildly behind schedule and nearing completion. The team lead can either add more staff to speed delivery or extend the deadline modestly. Adding new staff late in a project increases onboarding time and can temporarily reduce productivity (a phenomenon known as Brooks's Law), while a modest extension preserves quality. Which is generally the more prudent choice?

1. A.Add a large number of new staff immediately regardless of project stage
2. B.Extend the deadline modestly rather than add staff late in the project✓
3. C.Cancel the project outright
4. D.Add staff and also extend the deadline simultaneously to be safe

Correct answer: B

A company is deciding whether to close an unprofitable factory in a small town where it is the largest employer. Which of the following considerations is LEAST relevant to a stakeholder-based analysis of this decision?

1. A.The economic impact on the town's employment and local economy
2. B.The company's long-term financial sustainability
3. C.The personal astrological chart of the CEO✓
4. D.The effect on the company's reputation among customers and investors

Correct answer: C

A retailer notices that stores with in-store promotional displays show 15% higher sales than stores without them, and concludes that installing displays in all stores will increase overall sales by 15%. What is the primary flaw in this reasoning?

1. A.The retailer used a percentage instead of absolute numbers
2. B.The comparison may reflect other differences between the two groups of stores rather than a true causal effect of the displays✓
3. C.15% is too small a difference to be meaningful
4. D.Sales data cannot be used for business decisions

Correct answer: B

What is the remainder when 7^100 is divided by 5?

1. A.1✓
2. B.2
3. C.3
4. D.4

Correct answer: A

If x + 1/x = 5, find the value of x² + 1/x².

1. A.21
2. B.23✓
3. C.25
4. D.27

Correct answer: B

The area of a circle is 154 cm². Find its circumference. (Use π = 22/7)

1. A.22 cm
2. B.44 cm✓
3. C.66 cm
4. D.88 cm

Correct answer: B

A bag contains 5 red and 3 blue balls. Two balls are drawn at random without replacement. What is the probability that both are red?

1. A.5/14✓
2. B.5/8
3. C.3/14
4. D.15/28

Correct answer: A

Pipe A can fill a tank in 6 hours and pipe B can empty it in 9 hours. If both pipes are opened together, how long will it take to fill the empty tank?

1. A.12 hours
2. B.15 hours
3. C.18 hours✓
4. D.21 hours

Correct answer: C

A company's expenses (in ₹ lakh) over 3 years are: Salaries — Y1: 50, Y2: 55, Y3: 60; Rent — Y1: 20, Y2: 20, Y3: 25; Marketing — Y1: 10, Y2: 15, Y3: 15. In which year was the total expense the highest, and what was it?

1. A.Y1, ₹80 lakh
2. B.Y2, ₹90 lakh
3. C.Y3, ₹100 lakh✓
4. D.Y3, ₹95 lakh

Correct answer: C

A pie chart shows a family's monthly budget: Housing 35%, Food 25%, Transportation 15%, Savings 15%, Other 10%. If the monthly income is ₹80,000, how much more is spent on Housing than on Savings?

1. A.₹12,000
2. B.₹14,000
3. C.₹16,000✓
4. D.₹18,000

Correct answer: C

Question: Is x > y? Statement I: x + 3 > y + 3. Statement II: 2x > 2y - 4. Which statement(s) alone are sufficient to answer the question?

1. A.Statement I alone is sufficient, but Statement II alone is not✓
2. B.Statement II alone is sufficient, but Statement I alone is not
3. C.Each statement alone is sufficient
4. D.Both statements together are required

Correct answer: A

Which international organisation publishes the annual 'World Economic Outlook' report?

1. A.World Bank
2. B.International Monetary Fund✓
3. C.World Trade Organization
4. D.United Nations Development Programme

Correct answer: B

The headquarters of the World Trade Organization (WTO) is located in which city?

1. A.New York
2. B.Geneva✓
3. C.Paris
4. D.Brussels

Correct answer: B

In which year was the Securities and Exchange Board of India (SEBI) given statutory powers through an Act of Parliament?

1. A.1988
2. B.1992✓
3. C.1996
4. D.2000

Correct answer: B

The Indian Constitution was adopted by the Constituent Assembly on which date?

1. A.15 August 1947
2. B.26 November 1949✓
3. C.26 January 1950
4. D.2 October 1949

Correct answer: B

Which Article of the Indian Constitution abolishes untouchability?

1. A.Article 14
2. B.Article 17✓
3. C.Article 21
4. D.Article 32

Correct answer: B

Which gas is most abundant in the Earth's atmosphere?

1. A.Oxygen
2. B.Carbon dioxide
3. C.Nitrogen✓
4. D.Argon

Correct answer: C

The Dronacharya Award in India is given for excellence in which field?

1. A.Sports performance
2. B.Sports coaching✓
3. C.Sports journalism
4. D.Sports administration

Correct answer: B