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Exam Practice
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Questions in this quiz (200)
1In unit price contracts, the line item quantities specified in the contract are set by the A/E.
- ATrue
- BFalse
2Unit price contracts are most appropriate in projects when line item quantities cannot be forecast by the A/E with accuracy at the start.
- ATrue
- BFalse
3In the unit price contracts, the GC has the obligation to complete the job even if the value of the work done exceeds the contract value by 50%
- ATrue
- BFalse
4In unit price contracts, the GC has the obligation to complete the job regardless of the line item quantities being smaller or larger than the A/E's estimates, as long as the variation is between 15-25%.
- ATrue
- BFalse
5"In unit price contracts, the owner must keep a field force to check primarily the quantities produced by the GC but also the quality of the work done"
- ATrue
- BFalse
6A big advantage of the unit price contract is that the owner knows the final duration of the job right at the outset with certainty.
- ATrue
- BFalse
7A big advantage of the unit price contract is that the owner knows the final cost of the job right at the outset with certainty.
- ATrue
- BFalse
8If a lien goes through the court, foreclosure takes place. The property is sold at auction, and the proceeds are used to pay debtors.
- ATrue
- BFalse
9A mechanics lien can be filed by a S/C if the GC does not pay the S/C.
- ATrue
- BFalse
10A mechanic's lien is an effective and much preferred dispute resolution method.
- ATrue
- BFalse
11Laws related to mechanic's liens are different ways in different states.
- ATrue
- BFalse
12A mechanics lien can be filed by a GC if the GC is not paid by the owner.
- ATrue
- BFalse
13A mechanics lien can be filed by a GC if the S/Cs are not paid by the owner.
- ATrue
- BFalse
14Public property is not subject to lien.
- ATrue
- BFalse
15The work on the construction site can be suspended by the GC if the GC is not able to procure the necessary construction materials.
- ATrue
- BFalse
16The owner always awards a time extension to the GC in the event of natural disasters.
- ATrue
- BFalse
17Unforeseen weather conditions constitute a good reason for the GC to file a claim for a time extension.
- ATrue
- BFalse
18Suspension of work by the GC is an excusable - non compensable delay.
- ATrue
- BFalse
19Suspension of work by the owner is an excusable - compensable delay.
- ATrue
- BFalse
20A delay caused by a natural disaster is considered to be an excusable - compensable delay.
- ATrue
- BFalse
21The work on the construction site can be suspended by the owner because of financial or legal difficulties.
- ATrue
- BFalse
22"If a non-excusable delay in an activity causes a delay in the total project duration, the GC will have to pay liquidated damages."
- ATrue
- BFalse
23"Work on a construction site can be suspended by the owner, by the GC, by a subcontractor, or by the union."
- ATrue
- BFalse
24Change orders are always initiated by subcontractors.
- ATrue
- BFalse
25"Final payment is made at substantial completion, but only surety s consent."
- ATrue
- BFalse
26Final payment is not made without the approval of the surety company.
- ATrue
- BFalse
27"Substantial completion is the accomplishment by the general contractor of all things essential to the fulfillment of the purpose of the contract, although there may be inconsequential deviations from certain terms."
- ATrue
- BFalse
28"Retainage is returned along with the final payment only when the owner is sure that the project has been completed by the GC in accordance with plans and specs, and that the GC does not owe any money to any other party."
- ATrue
- BFalse
29"Substantial completion is the accomplishment by the general contractor of all things related to the contract, including the items on the punch list."
- ATrue
- BFalse
30The punch list is submitted to the GC after the final payment is made.
- ATrue
- BFalse
31Final payment is made at final completion.
- ATrue
- BFalse
32Contract bonds are issued by insurance companies.
- ATrue
- BFalse
33Contract bonds cover the warranty period too.
- ATrue
- BFalse
34"By law, private owners have to use statutory bonds rather than common-law bonds."
- ATrue
- BFalse
35Statutory bonds have a face value 100% in case of payment bonds.
- ATrue
- BFalse
36Bonding capacity is the amount of work a surety company will allow a GC to perform at any time.
- ATrue
- BFalse
37Performance bonds protect the owner against GC default.
- ATrue
- BFalse
38Transferring the risk of contractor default to a third party is not always the best practice; in some countries some or all of this risk is retained by the owner.
- ATrue
- BFalse
39Contract bonds are submitted by all S/Cs to the construction owner for the protection of the GC.
- ATrue
- BFalse
40Transferring the risk of contractor default to a thirty party costs the owner extra money in term so the premiums paid to the third party.
- ATrue
- BFalse
41The Wagner Act of 1935 governs statutory bonds used by public owners.
- ATrue
- BFalse
42"The damages caused by contractor default are paid by the surety company to the owner, but the surety company has the right to get this money back from the defaulting contractor."
- ATrue
- BFalse
43Statutory bonds have a face value 100% in case of performance bonds.
- ATrue
- BFalse
44The terms of common-law bonds are worked out by the private owner.
- ATrue
- BFalse
45Contract bonds are required by law in all public contracts.
- ATrue
- BFalse
46Contract bonds are instruments that allow a construction owner to transfer the risk of contractor default to a third party.
- ATrue
- BFalse
47A corporation cannot operate outside the business stated in the charter of the corporation.
- ATrue
- BFalse
48The Board of Directors makes by-laws to regulate the day-to-day operations of the corporation.
- ATrue
- BFalse
49Each director of the board is an agent of the company because he/she has been given the authority to act on behalf of the company.
- ATrue
- BFalse
50Shareholders who own preferred stock have voting rights.
- ATrue
- BFalse
51The President of a corporation acts on behalf of the corporation only after approval by the entire Board of Directors.
- ATrue
- BFalse
52All construction-related corporations are categorized as public corporations (rather than private corporations).
- ATrue
- BFalse
53A corporation based in Illinois cannot operate in another state unless they get a certificate of authority from that state.
- ATrue
- BFalse
54"The owner may file a claim for extra time with the GC, just as the GC can file a claim for extra time with the owner."
- ATrue
- BFalse
55The impact as-planned technique is not accepted by most courts of law in construction delay cases.
- ATrue
- BFalse
56Concurrent delays involve delays occurring in different parallel activities on the same day.
- ATrue
- BFalse
57Time impact analysis technique is the most precise and reliable delay analysis technique.
- ATrue
- BFalse
58A GC's claim for extra time is not approved by the owner if the reason for the claim is that the GC was not able to receive the materials on time.
- ATrue
- BFalse
59A delay in an activity may or may not cause delay in the overall project duration.
- ATrue
- BFalse
60Time extension claims can be filed at any time during construction.
- ATrue
- BFalse
61Non-excusable delays are always non-compensable.
- ATrue
- BFalse
62The party responsible for the excusable delays is always the GC.
- ATrue
- BFalse
63The collapsed as-built technique involves comparing the work schedule approved by the owner at the beginning of the contract with the updated work schedule developed after the contract has been completed.
- ATrue
- BFalse
64Objective impossibility of performance is not a good reason for terminating a contract if the parties knew about the problem at the time they signed the contract.
- ATrue
- BFalse
65A GC can terminate the contract if the owner fails to make payments.
- ATrue
- BFalse
66The owner can terminate the contract if the GC does not perform.
- ATrue
- BFalse
67"When an owner terminates a contract, the owner has the right to take possession of all materials stored on the construction site."
- ATrue
- BFalse
68"If the owner capriciously terminates a GC, the owner may be liable for the GC's full anticipated profits."
- ATrue
- BFalse
69The owner can terminate the contract if the GC is in breach of contract because the GC delayed by one day the completion of an important activity (placing of concrete).
- ATrue
- BFalse
70Subjective impossibility of performance has to do with the capabilities of one of the parties to the contract.
- ATrue
- BFalse
71The President of the United States has the right to stop a strike if the strike imperils national security and health.
- ATrue
- BFalse
72The prefabrication clause is not considered an unfair labor practice and may be part of the collective bargaining agreement.
- ATrue
- BFalse
73The National Labor Relations Board administers the National Labor Relations Act.
- ATrue
- BFalse
74The National Labor Relations Act was enacted by Congress to foster union activity in response to the great depression in the 1930's.
- ATrue
- BFalse
75"The AFL-CIO is a federation of many unions, including construction trade unions."
- ATrue
- BFalse
76The AFL-CIO represents only construction workers in the nation.
- ATrue
- BFalse
77The National Labor Relations Board has no statutory power to enforce decisions relative to unfair labor practices.
- ATrue
- BFalse
78The local does not need approval from the union when negotiating a collective bargaining agreement with an employer.
- ATrue
- BFalse
79"Unions, just like corporations, have to issue periodic public reports about their finances, activities, and policies."
- ATrue
- BFalse
80Illinois is a right-to-work state.
- ATrue
- BFalse
81Union construction is always more expensive than open shop construction.
- ATrue
- BFalse
82A job steward is the President and CEO of the local.
- ATrue
- BFalse
83Construction unions are craft unions rather than industrial unions.
- ATrue
- BFalse
84Charges of unfair labor practice may be filed by employers and unions alike.
- ATrue
- BFalse
85"Even though it amounts to conflict of interest, the union foreman clause is sometimes part of collective bargaining agreements."
- ATrue
- BFalse
86The Miller Act of 1935 governs labor relations today in the US (as amended by Taft-Hartley and Landrum-Griffin).
- ATrue
- BFalse
87Employers must refrain unfair labor practices; but unions are not bound by such restrictions.
- ATrue
- BFalse
88Charges of unfair labor practices are handled by the US Labor Department.
- ATrue
- BFalse
89A prefabrication clause in a collective bargaining agreement forbids the contractor the use of prefabricated components.
- ATrue
- BFalse
90To strike because of a jurisdictional dispute is an unfair labor practice on the part of the union.
- ATrue
- BFalse
91Small construction companies are more likely to fail than larger companies because they lack financial, technical, and managerial resources.
- ATrue
- BFalse
92"By the time a construction company displays financial failure symptoms, it is already too late to turn the company around."
- ATrue
- BFalse
93Research findings support the strategic management perspective (a well-managed company will survive and thrive), as well as the organizational ecology perspective (a company's survival is tied to a natural life cycle).
- ATrue
- BFalse
94Construction owners should transfer the risk of contractor default to a third party at any cost.
- ATrue
- BFalse
95It is impossible to predict with certainty that a construction company is on its way to default.
- ATrue
- BFalse
96Young and small construction companies are more likely to fail than older and larger construction companies.
- ATrue
- BFalse
97The rate of failure in the construction business is very high, reaching 25% per year.
- ATrue
- BFalse
98Young construction companies are more likely to fail than older companies because they did not yet establish enough external connections and because they did not yet accumulate enough knowledge internally.
- ATrue
- BFalse
99Construction owners should retain the risk of contractor default under all circumstances.
- ATrue
- BFalse
100The causes of company failure cannot be prevented by short-term management action.
- ATrue
- BFalse
101Defect of latent nature are not covered by the GC in the warranty period.
- ATrue
- BFalse
102The GC does not guarantee the adequacy of the design in the warranty period, unless the GC did the design.
- ATrue
- BFalse
103The warranty period starts at substantial completion.
- ATrue
- BFalse
104The length of time the owner is protected against defects of latent nature is governed by the different statutes of limitations that are in effect in different states.
- ATrue
- BFalse
105A construction defect detected during the warranty period is always the responsibility of the A/E.
- ATrue
- BFalse
106"If a construction defect detected during the warranty period is not fixed by the GC, the owner has the right to invoke contract bonds."
- ATrue
- BFalse
107Design defects detected in the warranty period are the responsibility of the A/E.
- ATrue
- BFalse
108Retainage is returned to the GC only if the GC has completed all items on the punch list.
- ATrue
- BFalse
109Retainage is withheld by the owner against the settlements of claims by parties unpaid by the general contractor.
- ATrue
- BFalse
110Retainage is withheld by the owner against the cost of remedying defective work.
- ATrue
- BFalse
111Retainage is kept by the owner through the warranty period.
- ATrue
- BFalse
112Retainage is withheld by the owner against the GC's serious breach of contract.
- ATrue
- BFalse
113"Private owners who trust their contractors, may decide not to withhold retainage."
- ATrue
- BFalse
114A portion of the retainage is returned at every intermediate payment.
- ATrue
- BFalse
115Liquidated damages constitute a penalty against the GC who delayed the completion of the project, and can be as large as the owner sees fit.
- ATrue
- BFalse
116The date on which the Notice to Proceed is issued by the owner denotes the start date of the contract.
- ATrue
- BFalse
117"The work schedule plays an important part in delay analysis, in case there are time-related claims/disputes."
- ATrue
- BFalse
118"The GC does not need the approval of the owner in preparing and implementing a work schedule, because the GC is the party who will actually perform the construction activities."
- ATrue
- BFalse
119Typically, substantial completion denotes the end date of the contract.
- ATrue
- BFalse
120An owner has the right to terminate a contract if it becomes apparent that the GC will not be able to complete the job on schedule.
- ATrue
- BFalse
121It is best to specify contract duration in calendar days rather than in work days.
- ATrue
- BFalse
122Liquidated damages are paid by the GC if the project is delayed because of the fault of the GC.
- ATrue
- BFalse
123The GC has to submit a work schedule for owner's approval within one month of the signing of the contract.
- ATrue
- BFalse
124"If the contract is silent about time, the GC has an obligation to complete the job in no more than a calendar year."
- ATrue
- BFalse
125A construction company enters into a joint venture to infiltrate into new markets and/or to undertake large and complex projects that could not be handled by the company alone.
- ATrue
- BFalse
126Joint ventures are difficult to manage because of the different cultures of its members.
- ATrue
- BFalse
127Partnering may involve a strategic alliance between a contractor and a subcontractor.
- ATrue
- BFalse
128An international joint venture often includes a member based in the host country.
- ATrue
- BFalse
129A joint venture many involve a strategic alliance between a contractor and its workers.
- ATrue
- BFalse
130The sole owner reports to the state government and can terminate the company only with government consent.
- ATrue
- BFalse
131Sole ownerships do not have to buy Workers Compensation Insurance for their workers.
- ATrue
- BFalse
132Sole ownerships constitute the large majority of construction companies in the US.
- ATrue
- BFalse
133The death of the sole owner does not affect the existence of the company.
- ATrue
- BFalse
134The sole owner has unlimited liability for the debts of the company.
- ATrue
- BFalse
135The sole owner has unlimited liability for the debts of the company's employees.
- ATrue
- BFalse
136Sole ownerships do most of the work (in terms of $ volume) in the US.
- ATrue
- BFalse
137The payments in unit price contracts are made on the basis of the quality of the work done by the GC.
- ATrue
- BFalse
138The percentage of project completion is calculated by dividing the value of the work completed in the last month by the total contract value.
- ATrue
- BFalse
139The percentage of completion of a line item in a lump sum contract is calculated by dividing the value of the work to be completed by the total cost of the line item.
- ATrue
- BFalse
140The total payment made by the owner in a lump sum contract does not exceed the contract value unless there are change orders.
- ATrue
- BFalse
141The Certificate of Payment is issued by the GC at the end of every six months and seeks payment from the owner.
- ATrue
- BFalse
142The payment in lump sum contracts are made on the basis of the quantities produced by the GC.
- ATrue
- BFalse
143The construction contract is financed by the contractor.
- ATrue
- BFalse
144"If a partner withdraws from a partnership, the partnership terminates."
- ATrue
- BFalse
145Partnership constitute the large majority of design firms in the US.
- ATrue
- BFalse
146"Limited partners have all the right and privileges of ordinary partners, but their number is limited (there are only a few of them)."
- ATrue
- BFalse
147All partners are principals and agents of the company.
- ATrue
- BFalse
148"If one has a lot of money, does not have expertise in the business, has confidence in the state of the industry, has confidence in the future of the partnership, and trusts explicitly the capabilities of the partners, one is better off just lending the money to the partnership rather than becoming an ordinary partner"
- ATrue
- BFalse
149Partners have unlimited liability for the debts of the company.
- ATrue
- BFalse
150Losses are shared by the partners always in the same proportions as profits.
- ATrue
- BFalse
151The parties who sign the contract must be legally competent but do not have to be older than 18 years of age.
- ATrue
- BFalse
152A contract is a promise for the breach of which the law gives a remedy and the performance of which the law recognizes as a duty.
- ATrue
- BFalse
153The consideration given by the promisee to the promisor for service/work should not be below industry standards.
- ATrue
- BFalse
154A contract has to be enforced regardless of whether the subject of the contract is legal or not.
- ATrue
- BFalse
155"A contract signed under stress is not legally binding, whereas a contract signed under undue influence is OK"
- ATrue
- BFalse
156A contract is not binding if a party to the contract can prove that he was drunk at the time the contract was signed.
- ATrue
- BFalse
157"For an agreement to constitute a legally binding contract, there must be at least two competent parties signing it, a lawful subject matter, mutual agreement, and valid consideration"
- ATrue
- BFalse
158An employer is obligated by law to purchase Payroll Insurance and Workers' Compensation Insurance.
- ATrue
- BFalse
159"When a worker is injured on the construction site, the worker has to sue the employer and has to prove that the employer was at fault if the worker wants to collect damages for the injury."
- ATrue
- BFalse
160Workers who are injured on the construction site will be compensated only for hospital expenses by their employers.
- ATrue
- BFalse
161Typically, Builder's Risk Insurance does not cover natural disasters such as earthquake, floor, and tornado.
- ATrue
- BFalse
162If the GC's accident record is good, the GC does not have to buy Workers' Compensation Insurance.
- ATrue
- BFalse
163A "waiver of subrogation" allows the owner and the GC to be on the insurance policy purchased by a subcontractor.
- ATrue
- BFalse
164Construction companies who have a great safety record pay less premium for workers compensation insurance than companies that have a dismal safety record.
- ATrue
- BFalse
165Disputes Review Boards are used only in tunnel construction.
- ATrue
- BFalse
166A mediator's decision is final and binding; parties to a mediation cannot appeal the decision of the mediator.
- ATrue
- BFalse
167Administrative Boards have an excellent reputation among contractors for fairness and competency.
- ATrue
- BFalse
168Arbitration is a method of dispute resolution that is used by all public owners.
- ATrue
- BFalse
169"In the State of Illinois, a construction dispute case is tried in the Circuit Court."
- ATrue
- BFalse
170Few construction projects are completed without disagreements between the owner and the contractor.
- ATrue
- BFalse
171Mediation is a method of dispute resolution that is faster and cheaper than arbitration.
- ATrue
- BFalse
172Contractors who have disagreements with public owners submit their case to the appropriate Board of Contracts Appeals before litigating.
- ATrue
- BFalse
173"Court overturn arbitrators decisions only in case of fraud, bad faith or conflict of interest in the proceedings."
- ATrue
- BFalse
174The A/E's decision is final and binding of the contract includes an engineer's decision clause.
- ATrue
- BFalse
175Most large government procuring agencies have a Board of Contracts Appeals.
- ATrue
- BFalse
176Litigation is by far the most expensive and time consuming dispute resolution method.
- ATrue
- BFalse
177A dispute-free environment can be achieved if the parties know the outcome of litigation before going to court.
- ATrue
- BFalse
178The members of the Disputes Review Board are appointed at the very beginning of the contract and remain in place all through the project.
- ATrue
- BFalse
179The biggest disadvantage of arbitration is the lack of competent and fair arbitrators.
- ATrue
- BFalse
180I/D contracts can reward/punish schedule performance, cost performance, quality performance, safety performance, or any other criterion that is a priority for the construction owner.
- ATrue
- BFalse
181It is recommended that the magnitude of potential rewards and penalties be equal to each other.
- ATrue
- BFalse
182The incentives and disincentives specified in an I/D contract do not replace the "liquidated damages" clause in the contract.
- ATrue
- BFalse
183Using only disincentives (and no incentives) is counterproductive.
- ATrue
- BFalse
184I/D contracts are used in projects of high visibility.
- ATrue
- BFalse
185I/D contracts increase the owner's inspection costs.
- ATrue
- BFalse
186"In schedule-based I/D contracts, a system is established to reward contractors who complete their projects ahead of schedule and to penalize contractors who complete their projects behind schedule"
- ATrue
- BFalse
187Some cost plus contracts are bid, and there are some that are negotiated.
- ATrue
- BFalse
188The scope of a cost plus fixed fee contract is better defined that the scope of a cost plus percentage of cost contract.
- ATrue
- BFalse
189Cost plus percentage of cost contracts are most appropriate in emergency situations when speedy action is necessary with design at its preliminary phase.
- ATrue
- BFalse
190Public owners are prohibited by law to sign cost plus contracts with a guaranteed maximum price.
- ATrue
- BFalse
191"In cost plus contracts, the owner must keep a field force to check the receipts, payrolls, vouchers of reimbursable items submitted by the GC"
- ATrue
- BFalse
192"A big advantage of the cost plus contract is that the owner can issue any change order as long as it is within the scope of the project, and the GC has the obligation to do it as long as the GC is reimbursed for it"
- ATrue
- BFalse
193Most public and private contracts are cost plus contracts.
- ATrue
- BFalse
194A big advantage of the lump sum contract is that the owner can issue any change order and the GC has the obligation to do it at no additional cost.
- ATrue
- BFalse
195"In lump sum contracts, the GC has the obligation to complete the job even if the cost exceeds the contract value"
- ATrue
- BFalse
196Almost all private and most public contracts are lump sum contracts
- ATrue
- BFalse
197In lump sum contracts, the scope of the project must be very well defined.
- ATrue
- BFalse
198In lump sum contracts, the GC is never protected against the risk of "changed conditions".
- ATrue
- BFalse
199Some lump sump contracts are bid, and there are some that are negotiated.
- ATrue
- BFalse
200Lump sum contracts are most appropriate when the design is not complete and the owner does not have a good idea of what is to be built.
- ATrue
- BFalse
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- Engineering Quiz on Exam Practice , created by Nick Thompson on 03/05/2018.
- Author
- Nick Thompson
- Language
- English
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