RESIDENTIAL CONTRACTOR EXAM STUDY GUIDE
QUESTIONS WITH DETAILED VERIFIED AND 100%
ACCURATE ANSWERS
GEORGIA RESIDENTIAL BASIC CONTRACTOR PRACTICE EXAMINATION
SECTION 1: BUSINESS AND CONTRACT LAW
Question 1
What is the primary purpose of a construction contract?
A. To eliminate the need for inspections
B. To establish a legally enforceable agreement defining rights and obligations
C. To avoid permits
D. To reduce insurance requirements
Answer: B
Explanation: A written contract defines the rights, obligations, scope of work,
payment terms, and responsibilities of both parties, helping prevent
misunderstandings and disputes.
Question 2
Which contract type places the greatest cost risk on the contractor?
A. Cost-plus contract
B. Time and materials
,C. Unit price contract
D. Lump-sum contract
Answer: D
Explanation: Under a lump-sum contract, the contractor agrees to complete the
work for a fixed price regardless of actual costs.
Question 3
A change order should always be:
A. Verbal only
B. Approved after the work is complete
C. Written and signed by all required parties
D. Submitted only to inspectors
Answer: C
Explanation: Written change orders prevent disputes regarding scope, schedule,
and cost.
Question 4
Which document defines the legal relationship between owner and contractor?
A. Inspection report
B. Material invoice
C. Construction contract
D. Daily log
Answer: C
Explanation: The construction contract establishes rights, duties, and obligations.
,Question 5
A subcontractor's work is defective and does not meet contract specifications.
What is generally the contractor's first contractual remedy?
A. Demolish the structure
B. Terminate the owner
C. Require correction of the defective work
D. File bankruptcy
Answer: C
Explanation: Most contracts require defective work to be repaired or replaced
before more severe remedies are pursued.
Question 6
When a contractor discovers differing site conditions not indicated in the plans,
what should be done immediately?
A. Ignore the condition
B. Continue construction without notice
C. Notify the owner and document the condition
D. Abandon the project
Answer: C
Explanation: Prompt notification preserves contractual rights and allows parties
to assess impacts on cost, time, and construction methods before proceeding.
Question 7
Before obtaining a Georgia Residential Basic Contractor license, an applicant must
generally:
A. Be at least 16 years old
B. Have a college degree
, C. Meet the licensing requirements established by the state licensing board
D. Be licensed in another state first
Answer: C
Explanation: Georgia requires applicants to satisfy education, experience,
examination, and other licensing requirements established by the licensing board.
Question 8
What is the primary purpose of a building permit?
A. To increase taxes
B. To verify compliance with applicable building codes
C. To guarantee contractor profits
D. To reduce insurance costs
Answer: B
Explanation: Building permits help ensure construction complies with adopted
codes and safety regulations.
Question 9
Who is primarily responsible for jobsite safety?
A. The owner
B. The architect
C. The building inspector
D. The contractor
Answer: D
Explanation: Contractors are responsible for maintaining safe working conditions
and complying with safety regulations.
QUESTIONS WITH DETAILED VERIFIED AND 100%
ACCURATE ANSWERS
GEORGIA RESIDENTIAL BASIC CONTRACTOR PRACTICE EXAMINATION
SECTION 1: BUSINESS AND CONTRACT LAW
Question 1
What is the primary purpose of a construction contract?
A. To eliminate the need for inspections
B. To establish a legally enforceable agreement defining rights and obligations
C. To avoid permits
D. To reduce insurance requirements
Answer: B
Explanation: A written contract defines the rights, obligations, scope of work,
payment terms, and responsibilities of both parties, helping prevent
misunderstandings and disputes.
Question 2
Which contract type places the greatest cost risk on the contractor?
A. Cost-plus contract
B. Time and materials
,C. Unit price contract
D. Lump-sum contract
Answer: D
Explanation: Under a lump-sum contract, the contractor agrees to complete the
work for a fixed price regardless of actual costs.
Question 3
A change order should always be:
A. Verbal only
B. Approved after the work is complete
C. Written and signed by all required parties
D. Submitted only to inspectors
Answer: C
Explanation: Written change orders prevent disputes regarding scope, schedule,
and cost.
Question 4
Which document defines the legal relationship between owner and contractor?
A. Inspection report
B. Material invoice
C. Construction contract
D. Daily log
Answer: C
Explanation: The construction contract establishes rights, duties, and obligations.
,Question 5
A subcontractor's work is defective and does not meet contract specifications.
What is generally the contractor's first contractual remedy?
A. Demolish the structure
B. Terminate the owner
C. Require correction of the defective work
D. File bankruptcy
Answer: C
Explanation: Most contracts require defective work to be repaired or replaced
before more severe remedies are pursued.
Question 6
When a contractor discovers differing site conditions not indicated in the plans,
what should be done immediately?
A. Ignore the condition
B. Continue construction without notice
C. Notify the owner and document the condition
D. Abandon the project
Answer: C
Explanation: Prompt notification preserves contractual rights and allows parties
to assess impacts on cost, time, and construction methods before proceeding.
Question 7
Before obtaining a Georgia Residential Basic Contractor license, an applicant must
generally:
A. Be at least 16 years old
B. Have a college degree
, C. Meet the licensing requirements established by the state licensing board
D. Be licensed in another state first
Answer: C
Explanation: Georgia requires applicants to satisfy education, experience,
examination, and other licensing requirements established by the licensing board.
Question 8
What is the primary purpose of a building permit?
A. To increase taxes
B. To verify compliance with applicable building codes
C. To guarantee contractor profits
D. To reduce insurance costs
Answer: B
Explanation: Building permits help ensure construction complies with adopted
codes and safety regulations.
Question 9
Who is primarily responsible for jobsite safety?
A. The owner
B. The architect
C. The building inspector
D. The contractor
Answer: D
Explanation: Contractors are responsible for maintaining safe working conditions
and complying with safety regulations.
