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CON 496: Construction Contract Administration With Correct Answers

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1. What is the "Eichleay Formula" used to calculate? • A) The amount of concrete needed for a foundation. • B) Home office overhead damages during a project delay. • C) The interest rate on late payments. • D) The structural load-bearing capacity of a beam. • Correct Answer: B. This legal formula helps contractors recover unabsorbed home office overhead when a project is suspended or delayed by the owner. 2. Which party typically owns the "Float" in a project schedule? • A) The Contractor exclusively. • B) The Owner exclusively. • C) The party that uses it first, unless the contract states otherwise. • D) The Architect. • Correct Answer: C. Most modern contracts specify that float is a shared resource for the benefit of the project. 3. What is a "Cardinal Change"? • A) A change involving the color red. • B) A change so fundamental that it is considered outside the original scope of the contract. • C) A change ordered by the lead architect. • D) A minor adjustment to the electrical plan. • Correct Answer: B. A cardinal change can be considered a breach of contract by the owner because it forces the contractor to perform work they didn't bargain for. 4. What does the "No Damage for Delay" clause mean? • A) The contractor cannot be sued for delays. • B) The contractor's only remedy for an owner-caused delay is a time extension, not money. • C) The project cannot be delayed for any reason. • D) Weather delays are not allowed.

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CON 496: Construction Contract Administration With
Correct Answers
1. What is the "Eichleay Formula" used to calculate?

 A) The amount of concrete needed for a foundation.

 B) Home office overhead damages during a project delay.

 C) The interest rate on late payments.

 D) The structural load-bearing capacity of a beam.

 Correct Answer: B. This legal formula helps contractors recover unabsorbed home
office overhead when a project is suspended or delayed by the owner.

2. Which party typically owns the "Float" in a project schedule?

 A) The Contractor exclusively.

 B) The Owner exclusively.

 C) The party that uses it first, unless the contract states otherwise.

 D) The Architect.

 Correct Answer: C. Most modern contracts specify that float is a shared resource for
the benefit of the project.

3. What is a "Cardinal Change"?

 A) A change involving the color red.

 B) A change so fundamental that it is considered outside the original scope of the
contract.

 C) A change ordered by the lead architect.

 D) A minor adjustment to the electrical plan.

 Correct Answer: B. A cardinal change can be considered a breach of contract by the
owner because it forces the contractor to perform work they didn't bargain for.

4. What does the "No Damage for Delay" clause mean?

 A) The contractor cannot be sued for delays.

 B) The contractor's only remedy for an owner-caused delay is a time extension, not
money.

 C) The project cannot be delayed for any reason.

 D) Weather delays are not allowed.

 Correct Answer: B. While common, many states limit the enforceability of these
clauses if the owner acted in bad faith.

5. What is "Quasi-Contract" (Contract implied-in-law)?

,  A) A contract signed by a ghostwriter.

 B) An obligation imposed by law to prevent unjust enrichment when no formal
contract exists.

 C) A verbal agreement between friends.

 D) A contract that is only half-finished.

 Correct Answer: B. It allows a party to recover the value of work performed even if a
written contract is missing or void.

6. What is "Course of Performance"?

 A) The speed at which a contractor works.

 B) The way parties have acted during the current contract, used to interpret
ambiguous terms.

 C) A training class for managers.

 D) The path of the heavy machinery on site.

 Correct Answer: B. If an owner consistently accepted a certain material, they may be
legally barred from rejecting it later.

7. What is "Indemnity" in a construction context?

 A) A type of tax.

 B) A requirement to compensate another party for loss or damage.

 C) A bonus for finishing early.

 D) The right to fire a subcontractor.

 Correct Answer: B. Contractors often indemnify owners against lawsuits resulting
from on-site accidents.

8. What is the "Mirror Image Rule" in contract law?

 A) The drawings must look like the building.

 B) An acceptance of an offer must exactly match the terms of the offer.

 C) Both parties must have the same insurance.

 D) The contractor must provide two copies of every report.

 Correct Answer: B. If the acceptance changes a term, it is technically a counter-offer,
not an acceptance.

9. What is "Substantial Performance"?

 A) Doing a great job on the project.

 B) When a contractor has performed the work well enough that only minor defects
remain.

,  C) When the owner pays half the bill.

 D) When the contractor buys all the materials.

 Correct Answer: B. It prevents an owner from refusing to pay the entire contract
sum over a few missing doorknobs.

10. What is a "Flow-Through" clause?

 A) A plumbing requirement.

 B) A clause that passes the obligations of the prime contract down to the
subcontractors.

 C) A way to move water off-site.

 D) An automatic payment system.

 Correct Answer: B. It ensures the subcontractor is bound by the same safety and
quality standards as the general contractor.

11. What is "Proprietary Data"?

 A) Information that is publicly available.

 B) Confidential information or trade secrets belonging to a company.

 C) Data about the property taxes.

 D) The contractor's phone list.

 Correct Answer: B. Contracts usually have clauses to protect this information during
the design phase.

12. What is "Anticipatory Repudiation"?

 A) Predicting a project will be successful.

 B) When one party clearly states or demonstrates they will not fulfill their contract
obligations before the deadline.

 C) A request for a change order.

 D) Signing the contract early.

 Correct Answer: B. The non-breaching party can sue immediately rather than
waiting for the actual deadline to pass.

13. What is a "Miller Act" bond?

 A) A bond for a beer company.

 B) A federal requirement for payment and performance bonds on federal
construction projects.

 C) A bond for small residential jobs.

 D) Insurance for a truck fleet.

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Subido en
27 de marzo de 2026
Número de páginas
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Escrito en
2025/2026
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