Effect of guessing

[tkulkarn]

I am trying to understand if there is a penalty for guessing in the last few questions.
I had always heard that there is a penalty for leaving questions unanswered and this is very serious.
But recently, I read that there is penalty even for guessing (although not as severe as that for blank questions)
My questions are:
-is there a penalty for guessing?
- how does the algorithm know that the test taker is guessing? Is there a minimum time limit that is built into the algorithm and if someone were to solve question before that time limit, then it is construed as a guess and penalized.

Thank you for the inputs.

[rkim81]

Just a question, how would the test know that you are guessing? I don't think its that smart. There could be other reasons why a student would answer a question quickly. For example, I've read a DS question and solved it 10-20 seconds with the correct answer. Usually when I guess, I'll actually have read the question and made an attempt to solve it and never do I blindly choose an answer in 5-10 seconds. I don't think the GMAT would be that thorough, but more importantly that evil. According to what I've read, not finishing the test is the worst thing you can do. Just my two cents.

[StaceyKoprince]

There isn't a penalty for guessing; the test doesn't know when you're guessing. There is, however, a penalty for wrong answers. (And, if you're guessing in a few seconds, chances are you're going to get the question wrong... right?)

There is a larger penalty, though, for not answering the question at all (running out of time before you're done with the test). So, you take the lesser of two evils: if you're running out of time, guess on every remaining question. Even if you get every single one wrong, the penalty is not as great as it would be for leaving them all blank.