General Contractor License Project Management 3

Question 1

A general contractor is preparing a bid for a lump-sum contract. Which cost element is most commonly overlooked that can lead to project losses?

Accepted Answer

General conditions and overhead costs

Answer

General conditions (site trailer, supervision, temporary utilities, insurance) and overhead are frequently underestimated, eroding project profit margins.

Question 2

What is the primary purpose of a preconstruction meeting held before work begins on a project?

Accepted Answer

To establish project communication protocols, schedules, and coordination procedures

Answer

Preconstruction meetings align all stakeholders on project procedures, communication channels, submittal requirements, and schedule milestones before work starts.

Question 3

Under a cost-plus contract with a Guaranteed Maximum Price (GMP), what happens if final project costs fall below the GMP?

Accepted Answer

Savings may be shared between the owner and contractor per the contract terms

Answer

GMP contracts typically include a savings clause that specifies how cost savings below the maximum price are split between owner and contractor.

Question 4

Which document establishes the contractor's quality control requirements and inspection procedures for a construction project?

Accepted Answer

Quality Control Plan (QCP)

Answer

A Quality Control Plan defines inspection checkpoints, testing requirements, deficiency correction procedures, and responsibilities for maintaining work quality.

Question 5

A subcontractor walks off the job due to a payment dispute with the general contractor. Under the terms of a standard subcontract, what is the general contractor's MOST appropriate immediate action?

Accepted Answer

Declare the subcontractor in default and issue a cure notice

Answer

Most subcontracts require a written cure notice giving the subcontractor an opportunity to remedy the default before termination can proceed.

General Contractor License Practice Test

General Contractor License Practice Test

General Contractor License Project Management 3