CEM 100 EXAM 2 QUESTIONS AND
ANSWERS
To make certain that a contractor pays only the correct price to vendors and
subcontractors for goods and services received to date and to also make certain that
total payment does not exceed the purchase order or subcontract amount a ______
system must be established by the contractor - Answer- Progress payment
Concerning a WBS, a WBS allows hierarchical build-up of costs and schedule therefore
Cost and Schedule can be reported _____ of the WBS - Answer- only at mid-level
A _____ is a hierarchical (from general to specific) tree structure of deliverables and
tasks that need to be performed to complete a project - Answer- Work Breakdown
Structure
A _____ is a person or group of people who have a vested interest in the success of an
organization and the environment in which the organization operates - Answer-
Stakeholder
The lowest level of the WBS is the _____. The _____ contains a list of Tasks to be
Performed that form the basis for the Schedule - Answer- Work Package (WP)
What is a contract clause? - Answer- protects owner and/or the architect engineer by
transferring risk and uncertainty to the contractor
Is the contractor responsible for end results? Are they liable for the consequences of
design defects? - Answer- No
What is indemnification? - Answer- - Protects owners and architect-engineer from third
person liability
- construction contracts include indemnification or "hold-harmless" clauses
What is a hold-harmless clause? - Answer- requires that the contractor indemnify and
hold harmless the owner and architect-engineer, from all loss or expense by a reason of
liability imposed by law on them for damages because of bodily injury or damage to
property arising out of, or as a consequence of, the work
Limited form indemnification - Answer- holds owner and architect-engineer harmless
against claims caused solely by the negligence of the prime contractor or subcontractor
, intermediate-form indemnification - Answer- includes not only claims caused by
contractor or subcontractors but also in which the owner and/or architect-engineer may
be jointly responsible, regardless of degree of fault
Broad-form indemnification - Answer- Indemnifies the owner and/or architect-engineer
against all losses, even when the party indemnified is solely responsible for the loss
what is a complication of a subcontract? - Answer- if general contractor presents a
subcontract agreement for the subcontractor to sign that contains significant conditions
not set forth in the bidding documents or contract documents, it can be considered as a
counteroffer by the general contractor, and the bid of the subcontractor may not be
binding
Subcontract provisions - Answer- - similar to subcontract agreements in both form and
content
- pass-through clauses
What is a scope statement? - Answer- detailed description of work to be done by the
subcontractor. This should be included in the subcontract agreement
What is a no damage for delay clause? - Answer- In case of delay caused by general
contractor, the subcontractor's only remedy will be an extension of time to complete its
work
What is contract time? - Answer- contract documents state duration (# of days) in which
a contractor must satisfactorily complete all the requirements of the contract documents
- often uses the term calendar days
What is liquidated damages? - Answer- An assessment. Used in lieu of a determination
of the actual damages suffered
What are extensions of time? - Answer- occurrences that delay or add to the period of
time necessary to build the project
T or F: failure to complete a project in a certain amount of time is a breech in contract -
Answer- True
What is acceleration? - Answer- Owner's directing the prime contractor to accelerate its
performance of the work so as to complete the project at an earlier date than the current
rate work advancement will permit
What is differing site? - Answer- - a physical aspect of project or its site that differs
materially from that indicated by the contract documents
ANSWERS
To make certain that a contractor pays only the correct price to vendors and
subcontractors for goods and services received to date and to also make certain that
total payment does not exceed the purchase order or subcontract amount a ______
system must be established by the contractor - Answer- Progress payment
Concerning a WBS, a WBS allows hierarchical build-up of costs and schedule therefore
Cost and Schedule can be reported _____ of the WBS - Answer- only at mid-level
A _____ is a hierarchical (from general to specific) tree structure of deliverables and
tasks that need to be performed to complete a project - Answer- Work Breakdown
Structure
A _____ is a person or group of people who have a vested interest in the success of an
organization and the environment in which the organization operates - Answer-
Stakeholder
The lowest level of the WBS is the _____. The _____ contains a list of Tasks to be
Performed that form the basis for the Schedule - Answer- Work Package (WP)
What is a contract clause? - Answer- protects owner and/or the architect engineer by
transferring risk and uncertainty to the contractor
Is the contractor responsible for end results? Are they liable for the consequences of
design defects? - Answer- No
What is indemnification? - Answer- - Protects owners and architect-engineer from third
person liability
- construction contracts include indemnification or "hold-harmless" clauses
What is a hold-harmless clause? - Answer- requires that the contractor indemnify and
hold harmless the owner and architect-engineer, from all loss or expense by a reason of
liability imposed by law on them for damages because of bodily injury or damage to
property arising out of, or as a consequence of, the work
Limited form indemnification - Answer- holds owner and architect-engineer harmless
against claims caused solely by the negligence of the prime contractor or subcontractor
, intermediate-form indemnification - Answer- includes not only claims caused by
contractor or subcontractors but also in which the owner and/or architect-engineer may
be jointly responsible, regardless of degree of fault
Broad-form indemnification - Answer- Indemnifies the owner and/or architect-engineer
against all losses, even when the party indemnified is solely responsible for the loss
what is a complication of a subcontract? - Answer- if general contractor presents a
subcontract agreement for the subcontractor to sign that contains significant conditions
not set forth in the bidding documents or contract documents, it can be considered as a
counteroffer by the general contractor, and the bid of the subcontractor may not be
binding
Subcontract provisions - Answer- - similar to subcontract agreements in both form and
content
- pass-through clauses
What is a scope statement? - Answer- detailed description of work to be done by the
subcontractor. This should be included in the subcontract agreement
What is a no damage for delay clause? - Answer- In case of delay caused by general
contractor, the subcontractor's only remedy will be an extension of time to complete its
work
What is contract time? - Answer- contract documents state duration (# of days) in which
a contractor must satisfactorily complete all the requirements of the contract documents
- often uses the term calendar days
What is liquidated damages? - Answer- An assessment. Used in lieu of a determination
of the actual damages suffered
What are extensions of time? - Answer- occurrences that delay or add to the period of
time necessary to build the project
T or F: failure to complete a project in a certain amount of time is a breech in contract -
Answer- True
What is acceleration? - Answer- Owner's directing the prime contractor to accelerate its
performance of the work so as to complete the project at an earlier date than the current
rate work advancement will permit
What is differing site? - Answer- - a physical aspect of project or its site that differs
materially from that indicated by the contract documents
