General Contractor License Planning and Estimating 4 — Questions and Answers
Question 1: A subcontractor's bid is missing clarifications on exclusions. What should the GC do before including it in the bid?
- Use the bid as submitted to stay competitive
- Contact the subcontractor to clarify scope before bid day (Correct answer)
- Add a 20% contingency and include it
- Exclude the sub and use the next lowest
Correct answer: Contact the subcontractor to clarify scope before bid day
The GC must clarify scope gaps with subcontractors before bid submission to avoid costly scope gaps or disputes during construction.
Question 2: What is the function of general conditions (general requirements) in a cost estimate?
- They cover direct material and labor for the structure
- They cover project-wide costs like supervision, temporary facilities, and insurance (Correct answer)
- They define the profit margin
- They specify subcontractor payment terms
Correct answer: They cover project-wide costs like supervision, temporary facilities, and insurance
General conditions costs cover project management, site office, utilities, safety, and other overhead costs tied to the project duration.
Question 3: What is meant by 'phased construction' in project planning?
- Paying subcontractors in phases
- Breaking the project into sequential stages to allow early occupancy or faster completion (Correct answer)
- Dividing the estimate into material and labor phases
- Scheduling inspections in three phases
Correct answer: Breaking the project into sequential stages to allow early occupancy or faster completion
Phased construction sequences the work so that completed portions can be occupied or used while the rest of the project continues.
Question 4: When a contractor reviews an RFI (Request for Information) during estimating, what is its purpose?
- To request a bid bond from the surety
- To seek clarification on ambiguous or missing information in the bid documents (Correct answer)
- To notify the owner of a price increase
- To submit a change order
Correct answer: To seek clarification on ambiguous or missing information in the bid documents
An RFI formally asks the designer or owner to clarify unclear, conflicting, or missing information in the project documents.
Question 5: What does 'bid shopping' refer to, and why is it considered unethical?
- Visiting multiple supply houses for material quotes — standard practice
- Revealing a subcontractor's price to competitors to drive it lower, which undermines trust (Correct answer)
- Bidding on too many projects at once
- Shopping for the lowest bond rate
Correct answer: Revealing a subcontractor's price to competitors to drive it lower, which undermines trust
Bid shopping is using one sub's number to pressure others to undercut it, which is widely considered unethical and can damage long-term relationships.
Question 6: In a CPM schedule, activities on the critical path have float equal to:
- The project duration
- Ten percent of the activity duration
- Zero (Correct answer)
- The owner-specified buffer
Correct answer: Zero
By definition, all activities on the critical path have zero float — any delay to them directly delays the project end date.
Question 7: What is a 'bid bond' and when is it typically required?
- Insurance that covers workers on the project
- A surety bond guaranteeing the contractor will honor the bid price if awarded the contract (Correct answer)
- A bond ensuring subcontractors are paid
- A performance guarantee submitted after award
Correct answer: A surety bond guaranteeing the contractor will honor the bid price if awarded the contract
A bid bond is a surety instrument that protects the owner if the low bidder refuses to enter the contract, typically required on public projects.
General Contractor License Planning and Estimating 4
A subcontractor's bid is missing clarifications on exclusions.
What should the GC do before including it in the bid?