CM 4211
Which of the following statements is true? Select one: a. Whether a project will require union labor or not is something that will be found in the general conditions. b. Bid forms may require information about the contractor's work history and financial strength. c. The bid form itself is drafted and completed by the contractor d. Instructions to Bidders is where prospective bidders find out how to get to the owner's office to pick up the bid documents.
Bid forms may require information about the contractor's work history and financial strength.
Most negotiated contracts use the unit price method of construction.
False
Which of the following statements is true? Select one: a. . If the contract contains a "no-damages-for-delay" clause, the contractor will not be entitled to either a time adjustment nor a cost adjustment in the contract caused by a delay. b. Contractors prefer a contract to have a narrow list of excusable delays. c. In the dispute resolution clause of a private project contract, it is important to know whether or not sovereign immunity has been waived. d. If a contract has no differing site conditions clause, then the contractor is responsible for the costs if conditions are encountered that are more costly to overcome.
If a contract has no differing site conditions clause, then the contractor is responsible for the costs if conditions are encountered that are more costly to overcome.
Which of the following statements is true? Select one: a. In a cost-plus-incentive-fee (CPIF) contract the contractor can lose money. b. In a guaranteed-maximum-price (GMP) contract the contractor can never lose money. c. A fixed price contract holds more risk for the owner than a cost-plus contract. d. A schedule-of-items contract is a type of cost-plus-incentive-fee contract.
In a cost-plus-incentive-fee (CPIF) contract the contractor can lose money.
Which of the following statements is true? Select one: a. Standard form contracts are used because they contain provisions deemed to be fair to the parties. b. The four most important things that should be in an advertisement (for a construction project) are (1) project identification, (2) contractor identification, (3) time and place for the bid opening, and (4) instructions how to get the bid documents. c. The completed "bid form" is the contract in a construction project. d. In an AIA standard form contract, if there is any bias it is in favor of the contractor.
Standard form contracts are used because they contain provisions deemed to be fair to the parties.
Which of the following statements is true? Select one: a. "Liquidated damages" are assessed based on the actual damages suffered by the owner. b. The time provisions in a construction contract are usually measured in work days. c. The owner usually has the unilateral right to terminate a construction contract. d. A contractor cannot be assessed damages for missing milestone completion dates provided that he completes the entire contract timely.
The owner usually has the unilateral right to terminate a construction contract.
Which of the following statements is NOT true? Select one: a. There is no implied obligation for the owner to provide access to the construction site b. A default termination by the owner may be justified if the contractor is doing unsatisfactory work. c. "Liquidated damages" is the amount per day that a contractor owes for completing the contract late d. . It is normal for a contract to provide for monthly progress payments to the contractor.
There is no implied obligation for the owner to provide access to the construction site
"ESOP" stands for Employer Stock Operation Plan.
false
"LLC" stands for Limited Liability Corporation.
false
"Liquidated damages" are assessed based on the actual damages suffered by the owner.
false
A contract may be formed even when the objective is unclear.
false
A contractor cannot be assessed damages for missing milestone completion dates provided that he completes the entire contract timely.
false
A corporation is formed under federal laws
false
A fixed price contract holds more risk for the owner than a cost-plus contract
false
A partnership agreement must be in writing.
false
A partnership is an association of four or more entities formed to carry on a business for mutual profit.
false
A permanent license surety bond guarantees a contractor before the contractor becomes licensed.
false
A prime contract is any contract in which one of the parties is a construction contractor
false
A schedule-of-items contract is a type of cost-plus-incentive-fee contract.
false
A subcontractor has a contract with the owner.
false
An S corporation can have an unlimited number of stockholders
false
An offer is a conditional willingness to enter into an agreement.
false
Consideration must always be in terms of money for there to be a contract.
false
Contractors prefer a contract to have a narrow list of excusable delays.
false
Corporation is the simplest form of business entity.
false
Design-Build is the traditional approach to construction.
false
Fast-track services work best when there are separate contracts for design and construction
false
If the contract contains a "no-damages-for-delay" clause, the contractor will not be entitled to either a time adjustment nor a cost adjustment in the contract caused by a delay
false
In a cost-plus-percentage-fee (CPPF) contract, in addition to the contractor's reputation, there is a profit incentive for the contractor to hold down the costs of the construction.
false
In a guaranteed-maximum-price (GMP) contract the contractor can never lose money
false
In agency construction management the construction manager is at risk.
false
In an AIA standard form contract, if there is any bias it is in favor of the contractor.
false
In the dispute resolution clause of a private project contract, it is important to know whether or not sovereign immunity has been waived
false
In the traditional approach to construction, there will be one prime contract.
false
Instructions to Bidders is where prospective bidders find out how to get to the owner's office to pick up the bid documents.
false
Long-term financing is used to pay the construction costs.
false
Most construction projects are not unique because they resemble each other.
false
Officers of a corporation are not considered to be agents of the corporation.
false
Preemptive rights give a stockholder of a corporation the right to preempt actions by a creditor.
false
Retainage (or retention) is an amount kept by the owner from the progress payments to the contractor in order to penalize the contractor for completing the project late.
false
Supplementary conditions supplement the general conditions and usually remain the same from contract to contract.
false
The bid form itself is drafted and completed by the contractor.
false
The completed "bid form" is the contract in a construction project.
false
The contractor does not need to inspect the site prior to submitting a bid unless the bid documents expressly require such an inspection.
false
The five-threshold red flag construction contract clauses are (1) dispute resolution, (2) changes, (3) differing site conditions, (4) payments and progress payments, and (5) terminations and partial terminations.
false
The four most important things that should be in an advertisement (for a construction project) are (1) project identification, (2) contractor identification, (3) time and place for the bid opening, and (4) instructions how to get the bid documents.
false
The time provisions in a construction contract are usually measured in work days.
false
There is no implied obligation for the owner to provide access to the construction site.
false
Unless provided otherwise in a contract, the contractor is entitled to be paid for the invoice cost of materials delivered to the site even though they may not have been incorporated into the project at the time of billing the owner
false
Value engineering refers to saving money by cutting the quality of materials.
false
Whether a project will require union labor or not is something that will be found in the general conditions.
false
"Liquidated damages" is the amount per day that a contractor owes for completing the contract late.
true
A "variation in quantities" clause is intended to prevent an unfair gain or loss by the contractor due to a difference in the quantities actually incorporated into the project compared to what was estimated in the contract.
true
A default termination by the owner may be justified if the contractor is doing unsatisfactory work.
true
A design-build (DB) contract reduces the likelihood of a disagreement between the designer and the contractor.
true
A general partner of a partnership is an agent of the partnership.
true
A joint venture is an entity formed for one project.
true
A limited liability company is one of the formations used by construction companies.
true
A limited partnership means that the general partner is limited in his liability for partnership debts.
true
A set-aside is an amount of work reserved for small disadvantaged business enterprises
true
An "exculpatory" clause is one that shifts liability from one party to another (usually from the owner to the contractor).
true
An S corporation is a corporation that has elected to be taxed as a pass-through entity.
true
An acceptance that has conditions attached to it is a counter offer.
true
An architect is usually the lead designer on a commercial construction project
true
An illegal contract is unenforceable.
true
An indemnification clause can hold an owner harmless from losses on the project even if they are caused by the owner.
true
Bid forms may require information about the contractor's work history and financial strength.
true
Building codes are enforced by the use of permits, inspections, and testing reports
true
Competitive bidding and negotiated contract are the two basic ways to select a contractor
true
Competitive bidding is said to accomplish efficiency and innovation.
true
Consent to a contract cannot be coerced.
true
Custom residential building is when the owner has a building designed and built for the owner.
true
Directors of a corporation are not considered to be agents of the corporation.
true
Escalation clauses are used on long-term contracts to allow for increased labor and material costs.
true
Fast-Track refers to overlapping design and construction.
true
Hospital construction is one of the four broad categories of construction
true
If a contract has no differing site conditions clause, then the contractor is responsible for the costs if conditions are encountered that are more costly to overcome.
true
In a cost-plus-fixed-fee (CPFF) contract the contractor is incented to complete the project as soon as possible.
true
In a cost-plus-incentive-fee (CPIF) contract the contractor can lose money
true
In a dissolution of a partnership a partner who lends money to the partnership is paid ahead of any creditors of the partnership
true
It is normal for a contract to provide for monthly progress payments to the contractor.
true
More than half of the construction companies in the United States are proprietorships
true
Privity is the existence of a contractual relationship.
true
Public and private are the two broad classes of owners on a construction project.
true
Some of the largest projects in the United States were built by joint ventures
true
Standard form contracts are used because they contain provisions deemed to be fair to the parties
true
The changes clause usually gives the owner the unilateral right to make changes to the contract.
true
The contractor may rely on physical condition reports provided by the owner, supported by pre-bid inspection, unless the contract states otherwise
true
The owner acts as the prime contractor on a day labor construction project.
true
The owner usually has the unilateral right to terminate a construction contract.
true
The prime contractor is in privity with the owner on a construction project.
true
The two main reasons for licensing a contractor is to protect public health and safety.
true
Usually, inference is not enough to form a third-party relationship.
true
