CAC Contract Administration Flashcards
6 cards from real CAC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CAC Contract Administration flashcards as text
What is the purpose of a performance bond in construction?
Answer: To guarantee the contractor will complete the project if they default
A performance bond is a surety instrument that guarantees project completion if the contractor fails to perform their contractual obligations.
A payment bond primarily protects:
Answer: Subcontractors and suppliers who are not paid by the general contractor
A payment bond ensures that subcontractors, laborers, and material suppliers will be paid even if the general contractor fails to pay them.
Which contract delivery method gives the owner a single point of responsibility for both design and construction?
Answer: Design-Build
In Design-Build, one entity holds contracts for both design and construction, giving the owner a single point of responsibility and accountability.
Under a Cost-Plus contract, the contractor is paid:
Answer: Actual project costs plus a fee, which may be fixed or percentage-based
A Cost-Plus contract reimburses the contractor for all allowable project costs and adds a fee (fixed amount or percentage) for overhead and profit.
What is the primary purpose of a Guaranteed Maximum Price (GMP) provision?
Answer: To cap the owner's total cost exposure while sharing savings if costs come in below the GMP
A GMP sets a ceiling on what the owner will pay; if actual costs exceed the GMP, the contractor absorbs the overage, and savings are often shared.
Final completion differs from Substantial Completion in that final completion occurs when:
Answer: All punch list items are resolved and the contractor submits final closeout documents for final payment
Final completion is achieved when all remaining work is done, all closeout documents are submitted, and the owner makes the final payment to the contractor.