AFSB 152 Practice Exam ACTUAL EXAM QUESTIONS
WITH COMPLETE SOLUTION GUIDE) (MULTIPLE
CHOICES) (A+ GRADED 100% VERIFIED) LATEST
VERSION 2025
Contractor A submits a bid of $800,000, Contractor B submits $1 million,
Contractor C submits $1.2 million, and Contractor D submits $1.1 million. Which
one of the following explains the outcome of applying the 10 percent rule for
bids?
A. Because the next highest bid ($1 million) is 25 percent more than the low bid
($800,000), which is greater than a 10 percent difference, the bond underwriter
would carefully investigate the differences and may not issue the performance
and payment bonds.
B. Because the difference between the high and low bids is 50 percent more than
the low bid of $800,000, which is greater than a 10 percent difference, the bond
underwriter would probably decline to issue the performance and payment
bonds.
C. Because the average of the next two highest bids is 1.05 million, and the
difference between this amount and the low bid is 31.25 percent more than the
low bid of $800,000, which is greate - (ANSWER)A. Because the next highest bid
($1 million) is 25 percent more than the low bid ($800,000), which is greater than
a 10 percent difference, the bond underwriter would carefully investigate the
differences and may not issue the performance and payment bonds.
Which one of the following is true regarding types of contact status reports?
,Select one:
A. As comprehensive reports contain cumulative data, analyzing a series of
reports is not necessary.
B. Only the comprehensive report can prove useful in establishing billing-cost-
gross profit relationships.
C. Both basic and comprehensive reports provide a complete financial profile.
D. A basic status report shows specific and limited data for a contract. -
(ANSWER)D. A basic status report shows specific and limited data for a contract.
Samuel has been asked to underwrite a contract bond for an entity operating in
the U.S. that has an international parent. He is only willing to write the bond
through a cooperative underwriting agreement, with indemnity agreements from
the foreign parent and the U.S. entity. Under this arrangement, it is important
that the indemnification be perfected and enforceable under the laws of
A. The state where the project owner is located.
B. The location of the project.
C. The state where the U.S. entity is located.
D. The parent company's domicile. - (ANSWER)D. The parent company's domicile.
, Which one of the following describes a problem a project owner could encounter
when using a design/build contractor?
A. Government requirements may require a seal on the plans from a professional
engineer or a registered architect, and the design/build contractor may not have a
designer on staff.
B. The design/build contractor charges a separate design fee in addition to the
construction overhead and profit, so the overall project cost may be high.
C. Increased planning time should be allotted in the project for communication
among design professionals, contractors, and the project owner.
D. The design/build contractor has no experience with or knowledge of the costs
associated with various construction techniques and materials. - (ANSWER)A.
Government requirements may require a seal on the plans from a professional
engineer or a registered architect, and the design/build contractor may not have a
designer on staff.
The party that directly benefits from an enhanced competitive position in private
work because of the surety's assurance that its capacity to perform has been
carefully reviewed is the
A. Taxpayers.
B. Contractor.
WITH COMPLETE SOLUTION GUIDE) (MULTIPLE
CHOICES) (A+ GRADED 100% VERIFIED) LATEST
VERSION 2025
Contractor A submits a bid of $800,000, Contractor B submits $1 million,
Contractor C submits $1.2 million, and Contractor D submits $1.1 million. Which
one of the following explains the outcome of applying the 10 percent rule for
bids?
A. Because the next highest bid ($1 million) is 25 percent more than the low bid
($800,000), which is greater than a 10 percent difference, the bond underwriter
would carefully investigate the differences and may not issue the performance
and payment bonds.
B. Because the difference between the high and low bids is 50 percent more than
the low bid of $800,000, which is greater than a 10 percent difference, the bond
underwriter would probably decline to issue the performance and payment
bonds.
C. Because the average of the next two highest bids is 1.05 million, and the
difference between this amount and the low bid is 31.25 percent more than the
low bid of $800,000, which is greate - (ANSWER)A. Because the next highest bid
($1 million) is 25 percent more than the low bid ($800,000), which is greater than
a 10 percent difference, the bond underwriter would carefully investigate the
differences and may not issue the performance and payment bonds.
Which one of the following is true regarding types of contact status reports?
,Select one:
A. As comprehensive reports contain cumulative data, analyzing a series of
reports is not necessary.
B. Only the comprehensive report can prove useful in establishing billing-cost-
gross profit relationships.
C. Both basic and comprehensive reports provide a complete financial profile.
D. A basic status report shows specific and limited data for a contract. -
(ANSWER)D. A basic status report shows specific and limited data for a contract.
Samuel has been asked to underwrite a contract bond for an entity operating in
the U.S. that has an international parent. He is only willing to write the bond
through a cooperative underwriting agreement, with indemnity agreements from
the foreign parent and the U.S. entity. Under this arrangement, it is important
that the indemnification be perfected and enforceable under the laws of
A. The state where the project owner is located.
B. The location of the project.
C. The state where the U.S. entity is located.
D. The parent company's domicile. - (ANSWER)D. The parent company's domicile.
, Which one of the following describes a problem a project owner could encounter
when using a design/build contractor?
A. Government requirements may require a seal on the plans from a professional
engineer or a registered architect, and the design/build contractor may not have a
designer on staff.
B. The design/build contractor charges a separate design fee in addition to the
construction overhead and profit, so the overall project cost may be high.
C. Increased planning time should be allotted in the project for communication
among design professionals, contractors, and the project owner.
D. The design/build contractor has no experience with or knowledge of the costs
associated with various construction techniques and materials. - (ANSWER)A.
Government requirements may require a seal on the plans from a professional
engineer or a registered architect, and the design/build contractor may not have a
designer on staff.
The party that directly benefits from an enhanced competitive position in private
work because of the surety's assurance that its capacity to perform has been
carefully reviewed is the
A. Taxpayers.
B. Contractor.
