What is a potential basis for selecting in-group members in LMX?

• A. Personal compatibility with the supervisor and subordinates' competence
• B. Random selection
• C. Seniority
• D. Appearance

Answer: (A)

In Leader-Member Exchange, the in-group forms around a high-quality relationship between the leader and the member. The best basis for selecting in-group members is a combination of personal compatibility with the supervisor and the subordinates’ demonstrated competence. Personal compatibility signals trust, open communication, and mutual respect, making ongoing support and information sharing more effective. Demonstrated competence shows the employee can meet expectations and contribute to goals, making the reciprocal exchange more valuable for both sides. Together, these factors predict who can sustain a substantive, trusted relationship.

Why the other options don’t fit: random selection ignores the relational quality the leader seeks; relying on seniority doesn’t guarantee a strong working relationship or demonstrated capability; appearance has no bearing on whether a high-quality exchange can be established.