Master Plumber Exam Business Operations & Law 4

Question 1

What is the difference between a performance bond and a payment bond on a construction project?

Accepted Answer

Performance bonds guarantee project completion; payment bonds ensure subcontractors and suppliers are paid

Answer

A performance bond protects the owner if the contractor defaults; a payment bond protects subcontractors and suppliers from nonpayment by the prime contractor.

Question 2

A journeyman plumber working for a licensed master plumber causes water damage through negligent work. Who bears primary legal liability?

Accepted Answer

The master plumber and their company, under the doctrine of respondeat superior

Answer

Under respondeat superior, an employer is vicariously liable for the negligent acts of employees performed within the scope of their employment.

Question 3

A plumbing contractor receives a Notice of Intent to Lien from a material supplier. The contractor should respond by:

Accepted Answer

Issuing a joint check to the supplier and subcontractor to ensure payment

Answer

Issuing a joint check made out to both the subcontractor and the supplier ensures the supplier is paid directly, preventing the lien from being perfected.

Question 4

Under most state licensing laws, a master plumber's license is non-transferable. This means:

Accepted Answer

The license cannot be used by another person or entity

Answer

Non-transferability means the license is personal to the holder and cannot be assigned, leased, or used by another individual or business entity.

Question 5

A plumbing company employs six full-time workers. Under the Americans with Disabilities Act (ADA), does the company have to make reasonable accommodations for a disabled employee?

Accepted Answer

Yes, the ADA applies to employers with 15 or more employees, so this company is exempt

Answer

The federal ADA Title I applies to employers with 15 or more employees; however, many states have their own disability laws covering smaller employers.

Master Plumber Exam Practice Test

Master Plumber Exam Practice Test

Master Plumber Exam Business Operations & Law 4