Construction Law and Safety: Nevada
Contractor EXAM STUDY GUIDE
2026/2027 ACCURATE QUESTIONS WITH
CORRECT DETAILED SOLUTIONS ||
100% GUARANTEED PASS
<NEWEST VERSION>
1. When must you notify the Board? - ANSWER ✔ Within 30 days.
2. Are verbal change orders valid? - ANSWER ✔ No - they must be written
and signed.
3. Who pulls building permits? - ANSWER ✔ The contractor.
4. When must permits be issued? - ANSWER ✔ Before work starts.
5. Who must be licensed? - ANSWER ✔ All subcontractors.
6. How long must records be kept? - ANSWER ✔ 3 years.
7. What happens if your bond expires? - ANSWER ✔ The license is
suspended.
8. What releases a lien? - ANSWER ✔ Payment plus a written lien release.
9. What is overhead? - ANSWER ✔ General business operating expenses.
10.What is markup? - ANSWER ✔ Cost plus profit.
11.What is profit margin? - ANSWER ✔ Profit divided by selling price.
,12.Who provides PPE? - ANSWER ✔ The employer must provide and train
workers.
13.What is OSHA's General Duty Clause? - ANSWER ✔ Employer must
maintain a safe workplace.
14.When must you notify NSCB of a qualifying agent change? - ANSWER ✔
Within 30 days.
15.What must a change order include? - ANSWER ✔ Written description,
cost, time, and signatures.
16.Who enforces OSHA rules on the job? - ANSWER ✔ The
employer/contractor is responsible.
17.What is direct cost? - ANSWER ✔ Labor and materials used on the job.
18.What is licensing? - ANSWER ✔ Government authorization to perform
regulated work.
19.Why are contractor licenses required? - ANSWER ✔ To help protect the
public and ensure qualified work.
20.Why should permits be obtained when required? - ANSWER ✔ To comply
with applicable laws and allow inspections.
21.What is an inspection? - ANSWER ✔ A review to determine whether work
meets applicable requirements.
22.Why are inspections important? - ANSWER ✔ They help verify
compliance and safety.
23.What is a code? - ANSWER ✔ A set of adopted rules governing
construction and installations.
24.Why should plumbers follow the adopted code? - ANSWER ✔ To perform
compliant and safe installations.
,25.What is ethics? - ANSWER ✔ Moral principles that guide professional
conduct.
26.Why is honesty important in business? - ANSWER ✔ It builds trust and
long-term relationships.
27.What is a purchase order? - ANSWER ✔ A document authorizing the
purchase of goods or services.
28.What is inventory? - ANSWER ✔ Materials and supplies kept on hand.
29.Why should inventory be tracked? - ANSWER ✔ To control costs and
reduce shortages.
30.What is a receipt? - ANSWER ✔ A record showing payment was received.
31.What is payroll? - ANSWER ✔ The process of paying employees.
32.Why are payroll records important? - ANSWER ✔ For legal, tax, and
business purposes.
33.What is a timesheet? - ANSWER ✔ A record of hours worked.
34.Why should labor hours be tracked? - ANSWER ✔ To estimate costs and
measure productivity.
35.A performance bond guarantees payment to subcontractors and suppliers.
False
True - ANSWER ✔ False
36.A surety must act immediately upon receiving complaints from the obligee.
True
False - ANSWER ✔ False
37.What is the primary legal difference between insurance and a performance
bond?
a. Insurance involves three parties; bonds involve two
, b. Insurance covers unknown accidents; bonds cover failure to perform
c. Insurance is always required by law; bonds are optional
d. Insurance protects the contractor; bonds protect the surety - ANSWER
✔ b. Insurance covers unknown accidents; bonds cover failure to
perform
38.Which document often strengthens the surety's right to recover losses from
the principal?
a. Notice to Proceed
b. General Agreement of Indemnity
c. Certificate of substantial Completion
d. Change Order - ANSWER ✔ b. General Agreement of Indemnity
39.A surety can be held liable for more than the penal sum of the bond if it
delays performance after stepping in.
True
False - ANSWER ✔ True
40.What is the main drawback of using the Total Cost Method in construction
claims?
a.It requires too much detailed cost data
b. It assumes the contractor's bid and performance were completely accurate
c.It can only be used for small projects
d.It always results in higher profit margins - ANSWER ✔ b. It assumes the
contractor's bid and performance were completely accurate
41.Which of the following help determine the costs/price of damages?
a. If the situation is Reasonable or Unreasonable
b. If the situation calls for a change in project
c. If the situation call for terminations on different teams
d. All of the above - ANSWER ✔ d. All of the above
42.Which of the following best describe when punitive damages may be
awarded in a breach of contract case?
a.When the breach is accompanied by fraud, malice, or willful and wanton
misconduct
B.whenever the breach of contract is intentional, even without wrongful
conduct
c.Anytime the plaintiff suffers financial loss due to the breach
Contractor EXAM STUDY GUIDE
2026/2027 ACCURATE QUESTIONS WITH
CORRECT DETAILED SOLUTIONS ||
100% GUARANTEED PASS
<NEWEST VERSION>
1. When must you notify the Board? - ANSWER ✔ Within 30 days.
2. Are verbal change orders valid? - ANSWER ✔ No - they must be written
and signed.
3. Who pulls building permits? - ANSWER ✔ The contractor.
4. When must permits be issued? - ANSWER ✔ Before work starts.
5. Who must be licensed? - ANSWER ✔ All subcontractors.
6. How long must records be kept? - ANSWER ✔ 3 years.
7. What happens if your bond expires? - ANSWER ✔ The license is
suspended.
8. What releases a lien? - ANSWER ✔ Payment plus a written lien release.
9. What is overhead? - ANSWER ✔ General business operating expenses.
10.What is markup? - ANSWER ✔ Cost plus profit.
11.What is profit margin? - ANSWER ✔ Profit divided by selling price.
,12.Who provides PPE? - ANSWER ✔ The employer must provide and train
workers.
13.What is OSHA's General Duty Clause? - ANSWER ✔ Employer must
maintain a safe workplace.
14.When must you notify NSCB of a qualifying agent change? - ANSWER ✔
Within 30 days.
15.What must a change order include? - ANSWER ✔ Written description,
cost, time, and signatures.
16.Who enforces OSHA rules on the job? - ANSWER ✔ The
employer/contractor is responsible.
17.What is direct cost? - ANSWER ✔ Labor and materials used on the job.
18.What is licensing? - ANSWER ✔ Government authorization to perform
regulated work.
19.Why are contractor licenses required? - ANSWER ✔ To help protect the
public and ensure qualified work.
20.Why should permits be obtained when required? - ANSWER ✔ To comply
with applicable laws and allow inspections.
21.What is an inspection? - ANSWER ✔ A review to determine whether work
meets applicable requirements.
22.Why are inspections important? - ANSWER ✔ They help verify
compliance and safety.
23.What is a code? - ANSWER ✔ A set of adopted rules governing
construction and installations.
24.Why should plumbers follow the adopted code? - ANSWER ✔ To perform
compliant and safe installations.
,25.What is ethics? - ANSWER ✔ Moral principles that guide professional
conduct.
26.Why is honesty important in business? - ANSWER ✔ It builds trust and
long-term relationships.
27.What is a purchase order? - ANSWER ✔ A document authorizing the
purchase of goods or services.
28.What is inventory? - ANSWER ✔ Materials and supplies kept on hand.
29.Why should inventory be tracked? - ANSWER ✔ To control costs and
reduce shortages.
30.What is a receipt? - ANSWER ✔ A record showing payment was received.
31.What is payroll? - ANSWER ✔ The process of paying employees.
32.Why are payroll records important? - ANSWER ✔ For legal, tax, and
business purposes.
33.What is a timesheet? - ANSWER ✔ A record of hours worked.
34.Why should labor hours be tracked? - ANSWER ✔ To estimate costs and
measure productivity.
35.A performance bond guarantees payment to subcontractors and suppliers.
False
True - ANSWER ✔ False
36.A surety must act immediately upon receiving complaints from the obligee.
True
False - ANSWER ✔ False
37.What is the primary legal difference between insurance and a performance
bond?
a. Insurance involves three parties; bonds involve two
, b. Insurance covers unknown accidents; bonds cover failure to perform
c. Insurance is always required by law; bonds are optional
d. Insurance protects the contractor; bonds protect the surety - ANSWER
✔ b. Insurance covers unknown accidents; bonds cover failure to
perform
38.Which document often strengthens the surety's right to recover losses from
the principal?
a. Notice to Proceed
b. General Agreement of Indemnity
c. Certificate of substantial Completion
d. Change Order - ANSWER ✔ b. General Agreement of Indemnity
39.A surety can be held liable for more than the penal sum of the bond if it
delays performance after stepping in.
True
False - ANSWER ✔ True
40.What is the main drawback of using the Total Cost Method in construction
claims?
a.It requires too much detailed cost data
b. It assumes the contractor's bid and performance were completely accurate
c.It can only be used for small projects
d.It always results in higher profit margins - ANSWER ✔ b. It assumes the
contractor's bid and performance were completely accurate
41.Which of the following help determine the costs/price of damages?
a. If the situation is Reasonable or Unreasonable
b. If the situation calls for a change in project
c. If the situation call for terminations on different teams
d. All of the above - ANSWER ✔ d. All of the above
42.Which of the following best describe when punitive damages may be
awarded in a breach of contract case?
a.When the breach is accompanied by fraud, malice, or willful and wanton
misconduct
B.whenever the breach of contract is intentional, even without wrongful
conduct
c.Anytime the plaintiff suffers financial loss due to the breach
