DBIA DBIA - Design-Build Institute of America Cost Management and Value Engineering Questions and Answers 2

Question 1

What is a design-build contingency fund primarily used for?

Accepted Answer

Covering unforeseen scope changes and unknown site conditions

Answer

Paying design team overtime wages

Answer

Funding marketing and proposal preparation costs

Answer

Compensating subcontractors for delays caused by the owner

Question 2

How does an 'allowance' differ from a 'contingency' in a design-build contract?

Accepted Answer

An allowance is for a known but undefined scope item; a contingency covers unknown risks

Answer

An allowance covers schedule delays; a contingency covers cost overruns

Answer

An allowance is owner-controlled; a contingency is subcontractor-controlled

Answer

An allowance is a profit reserve; a contingency is a fee adjustment

Question 3

In a design-build GMP contract, cost savings below the GMP are typically handled by:

Accepted Answer

Shared savings between the owner and design-builder per a negotiated formula

Answer

Returned entirely to the owner as a credit

Answer

Retained entirely by the design-builder as additional profit

Answer

Applied automatically to fund future change orders

Question 4

What is 'life-cycle cost analysis' (LCCA) and why is it important in design-build?

Accepted Answer

Evaluating total ownership costs over the facility's useful life to optimize design decisions

Answer

Calculating the cost of the design-build team's salaries over the project

Answer

Estimating construction costs using historical life-span data

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Reviewing equipment rental costs for the duration of construction

Question 5

Which party typically prepares and maintains the cost model in an integrated design-build project?

Accepted Answer

The design-builder's estimating team in collaboration with the designer

Answer

The owner's independent cost estimator exclusively

Answer

The lead subcontractor based on unit prices

Answer

The construction manager retained separately by the owner

Question 6

What is the purpose of a 'basis of design' document in managing design-build costs?

Accepted Answer

To document the design assumptions and criteria that underpin the project budget

Answer

To list all subcontractor bids received during procurement

Answer

To record change orders after construction begins

Answer

To certify that the design meets all local building codes