MICHIGAN BUILDERS LICENSE EXAM
200 EXAM QUESTIONS WITH VERIFIED ANSWERS & RATIONALES
Table of Contents
Section Domain Approx. Page
Questions Reference
I Licensing, Regulatory Affairs & 35 3
Business Law
II Business Management, 35 8
Estimating & Job Costing
III Contracts, Liability & Risk 30 13
Management
IV Marketing & Sales 20 17
V Project Management & 25 20
Scheduling
VI Michigan Residential Code & 30 24
Building Science
VII Construction Safety Standards 15 29
(MIOSHA)
VIII Trade Knowledge & 10 31
Construction Fundamentals
SECTION I: LICENSING, REGULATORY AFFAIRS & BUSINESS LAW
,1. What is the penalty for the first offense of practicing as a residential
builder without a license in Michigan?
A. $500 fine only
B. Not less than $5,000 and not more than $25,000 and/or one year in
prison
C. $1,000 fine and 6 months in jail
D. License revoked permanently
Correct Answer: B. In Michigan, engaging in residential building without
proper licensure is a serious statutory violation. The penalty for a first
offense is set between $5,000 and $25,000 and/or up to one year of
incarceration.
2. Which agency administers the Michigan Builders License Exam?
A. LARA
B. PSI
C. ABC
D. OSHA
Correct Answer: B. PSI (Professional Service Industries, Inc.) is the
contracted testing provider that administers the Michigan Builders
License exam on behalf of the state.
3. Which Michigan agency is primarily responsible for administering
the Occupational Code that governs builders and contractors?
,A. Michigan Department of Transportation (MDOT)
B. Michigan Department of Licensing and Regulatory Affairs (LARA)
C. Michigan Department of Treasury
D. Michigan Department of Labor and Economic Opportunity
Correct Answer: B. LARA, through the Building Codes Division, enforces
the Occupational Code (PA 299 of 1980).
4. What is the cost for the individual builder's license in Michigan?
A. $100
B. $195
C. $250
D. $500
Correct Answer: B. The fee for an individual builder's license is $195.
5. The Department and the ______ may remove a limitation from a
license.
A. Hearing Examiner
B. Director
C. Board
D. Commission
Correct Answer: C. The Board has the authority to remove limitations
from a license.
, 6. The Governor appoints the members of the Board with the advice
and consent of the ______.
A. Board
B. Director
C. Senate
D. Department
Correct Answer: C. Board members are appointed by the Governor with
Senate consent.
7. How many members serve on the Michigan Builders Board?
A. 7 members
B. 9 members
C. 11 members
D. 13 members
Correct Answer: B. The Board consists of 9 members — 6 individuals
with licenses in the occupation and 3 general public members.
8. What is required of a non-resident of Michigan to obtain a builder's
license?
A. $2,000 bond
B. Passing the Michigan builders exam
200 EXAM QUESTIONS WITH VERIFIED ANSWERS & RATIONALES
Table of Contents
Section Domain Approx. Page
Questions Reference
I Licensing, Regulatory Affairs & 35 3
Business Law
II Business Management, 35 8
Estimating & Job Costing
III Contracts, Liability & Risk 30 13
Management
IV Marketing & Sales 20 17
V Project Management & 25 20
Scheduling
VI Michigan Residential Code & 30 24
Building Science
VII Construction Safety Standards 15 29
(MIOSHA)
VIII Trade Knowledge & 10 31
Construction Fundamentals
SECTION I: LICENSING, REGULATORY AFFAIRS & BUSINESS LAW
,1. What is the penalty for the first offense of practicing as a residential
builder without a license in Michigan?
A. $500 fine only
B. Not less than $5,000 and not more than $25,000 and/or one year in
prison
C. $1,000 fine and 6 months in jail
D. License revoked permanently
Correct Answer: B. In Michigan, engaging in residential building without
proper licensure is a serious statutory violation. The penalty for a first
offense is set between $5,000 and $25,000 and/or up to one year of
incarceration.
2. Which agency administers the Michigan Builders License Exam?
A. LARA
B. PSI
C. ABC
D. OSHA
Correct Answer: B. PSI (Professional Service Industries, Inc.) is the
contracted testing provider that administers the Michigan Builders
License exam on behalf of the state.
3. Which Michigan agency is primarily responsible for administering
the Occupational Code that governs builders and contractors?
,A. Michigan Department of Transportation (MDOT)
B. Michigan Department of Licensing and Regulatory Affairs (LARA)
C. Michigan Department of Treasury
D. Michigan Department of Labor and Economic Opportunity
Correct Answer: B. LARA, through the Building Codes Division, enforces
the Occupational Code (PA 299 of 1980).
4. What is the cost for the individual builder's license in Michigan?
A. $100
B. $195
C. $250
D. $500
Correct Answer: B. The fee for an individual builder's license is $195.
5. The Department and the ______ may remove a limitation from a
license.
A. Hearing Examiner
B. Director
C. Board
D. Commission
Correct Answer: C. The Board has the authority to remove limitations
from a license.
, 6. The Governor appoints the members of the Board with the advice
and consent of the ______.
A. Board
B. Director
C. Senate
D. Department
Correct Answer: C. Board members are appointed by the Governor with
Senate consent.
7. How many members serve on the Michigan Builders Board?
A. 7 members
B. 9 members
C. 11 members
D. 13 members
Correct Answer: B. The Board consists of 9 members — 6 individuals
with licenses in the occupation and 3 general public members.
8. What is required of a non-resident of Michigan to obtain a builder's
license?
A. $2,000 bond
B. Passing the Michigan builders exam
