Identify how the verbal is used in the following sentence.
my favorite activity is running.
a. participle as an adjective
b. participle as a noun
c. gerund as an adverb
d. gerund as a predicate noun
e. infinitive as a noun
f. infinitive as a direct object

A verbal is a non-finite verb form; here it is "running".

The running in this sentence comes in the following construction:

X is running

this means that it's a part of the predicate, and it's a predicative noun.

It's also a gerund, because it ends with -ing.

The correct answer is d.