ARE 5.0 CONSTRUCTION AND EVALUATION EXAM
|ACTUAL QUESTIONS & VERIFIED ANSWERS 2026-
2027 UPDATED EDITION |GRADED A+
Question 1
(3) ways cost estimates can be performed during Programming
CORRECT ANSWER
1. Unit cost system.
2. Historical data on similar types of projects.
3. Cost per square foot.
Question 2
Cost estimating method used during the Schematic Design
CORRECT ANSWER
Preliminary (rough) estimates are based on pricing major elements, such as structural
system selected and the MEP systems used.
Question 3
Cost estimating method used during the Design Development
CORRECT ANSWER
Detailed pricing based on the actual components being considered, including windows,
curtain walls, finishes and equipment.
Question 4
1
@THE STUDY VAULT
,Cost estimating method used during the Construction Documents
CORRECT ANSWER
Complete and final pricing of the project, based on direct quotes from suppliers, installers,
sub-contractors and manufacturers.
Requires great deal of effort and can only be done once nearly everything in the building
has been specified.
This pricing is a final check before construction begins/allows for revision to the design as
needed to meet the budget.
Question 5
Factors that can have an effect on cost estimates
CORRECT ANSWER
1. Availability of labor & material, labor rates, material prices, resources to produce the
material, convenience of transportation, location (more remote = more costly), less
predictable costs of rural areas.
2. High Interest Rates = less housing construction = lower material prices
Increased cost of living = increased union wages and higher labor costs
Question 6
Typical profit margin factored into the Construction Cost estimate
CORRECT ANSWER
15-20% for smaller projects
10-15% for larger projects
5-10% for ver large projects
Question 7
2
@THE STUDY VAULT
,Typical fees of Engineering Consultants (Struc., MEP, Civil)
CORRECT ANSWER
Mechanical: 15%
Electrical: 12.5%
Civil: 10.5%
Structural: 9.4%
(% Construction Cost)
Question 8
ENR 20 Cities Building Cost Index
CORRECT ANSWER
Cost estimating with Parameter Costs can be adapted to a city by using ______ or adding
an inflation factor.
Question 9
A Pro-forma is a financial analysis of the building project, showing costs and return on
investment.
This report is typically done by the client at the beginning of the project to determine if
the project will be profitable.
CORRECT ANSWER
What is Pro-forma?
Who does it?
During what phase of the project is it typically done?
Question 10
3
@THE STUDY VAULT
, General Obligation Bond
CORRECT ANSWER
Municipal bond issues when a state or local government wants to raise money for a
project.
Shareholders (investors) are guaranteed to be repaid using future tax revenues.
Question 11
Revenue Bond
CORRECT ANSWER
Type of municipal bond where the shareholders are promised payment from the revenue
collection of the project, such as tolls from a new bridge, instead of being repaid by future
tax revenue.
It is less secure than a General Obligation Bond and typically offer slightly higher interest
rates.
Question 12
(5) phases used by firms to help in cost estimating
CORRECT ANSWER
1. Pre-planning/Proposal Phase: Cost is broken down by units, which would come from the
occupancy of the building.
2. Programming Phase: Function of spaces and unit costs come from similar buildings.
3. Schematic Design: Determines major elements in the building, such as number of
plumbing fixtures, electrical layout, structure, and mechanical systems.
4. Design Development: Defined materials like windows, doors, dropped ceilings, and
cabinets are added.
5. Construction Documents: Finishes are in place and should reflect the pre-bid cost
breakdowns.
4
@THE STUDY VAULT
|ACTUAL QUESTIONS & VERIFIED ANSWERS 2026-
2027 UPDATED EDITION |GRADED A+
Question 1
(3) ways cost estimates can be performed during Programming
CORRECT ANSWER
1. Unit cost system.
2. Historical data on similar types of projects.
3. Cost per square foot.
Question 2
Cost estimating method used during the Schematic Design
CORRECT ANSWER
Preliminary (rough) estimates are based on pricing major elements, such as structural
system selected and the MEP systems used.
Question 3
Cost estimating method used during the Design Development
CORRECT ANSWER
Detailed pricing based on the actual components being considered, including windows,
curtain walls, finishes and equipment.
Question 4
1
@THE STUDY VAULT
,Cost estimating method used during the Construction Documents
CORRECT ANSWER
Complete and final pricing of the project, based on direct quotes from suppliers, installers,
sub-contractors and manufacturers.
Requires great deal of effort and can only be done once nearly everything in the building
has been specified.
This pricing is a final check before construction begins/allows for revision to the design as
needed to meet the budget.
Question 5
Factors that can have an effect on cost estimates
CORRECT ANSWER
1. Availability of labor & material, labor rates, material prices, resources to produce the
material, convenience of transportation, location (more remote = more costly), less
predictable costs of rural areas.
2. High Interest Rates = less housing construction = lower material prices
Increased cost of living = increased union wages and higher labor costs
Question 6
Typical profit margin factored into the Construction Cost estimate
CORRECT ANSWER
15-20% for smaller projects
10-15% for larger projects
5-10% for ver large projects
Question 7
2
@THE STUDY VAULT
,Typical fees of Engineering Consultants (Struc., MEP, Civil)
CORRECT ANSWER
Mechanical: 15%
Electrical: 12.5%
Civil: 10.5%
Structural: 9.4%
(% Construction Cost)
Question 8
ENR 20 Cities Building Cost Index
CORRECT ANSWER
Cost estimating with Parameter Costs can be adapted to a city by using ______ or adding
an inflation factor.
Question 9
A Pro-forma is a financial analysis of the building project, showing costs and return on
investment.
This report is typically done by the client at the beginning of the project to determine if
the project will be profitable.
CORRECT ANSWER
What is Pro-forma?
Who does it?
During what phase of the project is it typically done?
Question 10
3
@THE STUDY VAULT
, General Obligation Bond
CORRECT ANSWER
Municipal bond issues when a state or local government wants to raise money for a
project.
Shareholders (investors) are guaranteed to be repaid using future tax revenues.
Question 11
Revenue Bond
CORRECT ANSWER
Type of municipal bond where the shareholders are promised payment from the revenue
collection of the project, such as tolls from a new bridge, instead of being repaid by future
tax revenue.
It is less secure than a General Obligation Bond and typically offer slightly higher interest
rates.
Question 12
(5) phases used by firms to help in cost estimating
CORRECT ANSWER
1. Pre-planning/Proposal Phase: Cost is broken down by units, which would come from the
occupancy of the building.
2. Programming Phase: Function of spaces and unit costs come from similar buildings.
3. Schematic Design: Determines major elements in the building, such as number of
plumbing fixtures, electrical layout, structure, and mechanical systems.
4. Design Development: Defined materials like windows, doors, dropped ceilings, and
cabinets are added.
5. Construction Documents: Finishes are in place and should reflect the pre-bid cost
breakdowns.
4
@THE STUDY VAULT
