The Fallacy of Hard Tests
This is really a question of statistics not of mathematics. Having done experiments on MBA students, we found that a well written multiple choice question is more accurate than 4 well written essays. The fact that we can easilly have 50 multiple choice questions and a maximum of 8 essays makes it a no brainer that multiple choice is much more accurate.
So it isn't a matter of how you reward guessing (which psychologist will say that rewarding guessing actually gets better accuracy). It is a question of how well written the questions are. Further the pass rate has absolutely nothing to do with the fraction needed to pass. Even high school students understand this one. So he seems totally confused.