NBA AGENT COMPREHENSIVE EXAM 2026
QUESTIONS AND ANSWERS 100% CORRECT
◉ What is a soft cap? What is the difference between a soft cap and a
hard cap? Which does the NBA have? Answer: The NBA has a soft cap.
A hard cap cannot be exceeded for any reason. A soft cap like the NBA's
contains exceptions which allow teams to sign players or make trades
that exceed the cap under certain conditions. In practice, few NBA teams
are under the cap during a season.
Certain components of the NBA's system function as a hard cap under
specific circumstances. See question number 20 for more information.
◉ Why have a soft cap? Answer: A soft cap promotes a team's ability to
retain its own players. Nobody likes it when a player plays with one
team his entire career, the fans love him, he wants to stay and the team
wants to keep him, but he has to leave because the team cannot offer him
a satisfactory contract. The exceptions under a soft cap allow teams to
keep players under these kinds of circumstances. In addition, they allow
teams to make a limited number of changes (replacing department
players, improvements, etc.) every year.
◉ What is the Collective Bargaining Agreement? Answer: - [ ] It's the
legal contract between the league and the players association that sets up
the rules by which the league operates. (It's commonly abbreviated as
"CBA," which is not to be confused with either the Chinese Basketball
, Association or the Continental Basketball Association. The abbreviation
CBA will be used in the remainder of this document.)
The CBA defines the salary cap, the procedures for determining how it is
set, the minimum and maximum salaries, the rules for trades, the
procedures for the NBA draft, and hundreds of other things that need to
be defined in order for a league like the NBA to function.
The CBA also prevents the NBA from being in violation of federal
antitrust laws. Many of the league's practices (such as the salary cap and
draft) would violate antitrust laws were they not agreed to via collective
bargaining (see question number 118).
◉ Has there always been a salary cap? Answer: It may surprise you to
learn that the NBA first had a salary cap in 1946-47, its first season. The
cap that season was $55,000, with most players earning between $4,000
and $5,000. Star player Joe Fulks earned $8,000, and Tom King earned a
league-highest $16,500 for his combined duties as player, publicity
director and business manager for the Detroit Falcons.
The "modern" NBA salary cap began in 1984-85, at $3.6 million. It
made steady but gradual increases of around $1-2 million each season
until 1994-95, when it was $15.964 million. Armed with a big TV
contract from NBC, the salary cap jumped to $23.0 million in 1995-96,
and increased to $26.9 million in 1997-98, the last season of the 1995
CBA (a 647% increase in 13 years). The ABC/ESPN TV contract, which
took effect with the 2002-03 season, provided $4.6 billion over six
years, but less in 2002-03 than NBC paid in 2001-02. As a result, the
salary cap went down for the first time ever in 2002-03.
Under the 2005 CBA the salary cap started at $49.5 million, and finished
at $58.044 million, a 17.26% increase, and averaging 3.45% per year.
QUESTIONS AND ANSWERS 100% CORRECT
◉ What is a soft cap? What is the difference between a soft cap and a
hard cap? Which does the NBA have? Answer: The NBA has a soft cap.
A hard cap cannot be exceeded for any reason. A soft cap like the NBA's
contains exceptions which allow teams to sign players or make trades
that exceed the cap under certain conditions. In practice, few NBA teams
are under the cap during a season.
Certain components of the NBA's system function as a hard cap under
specific circumstances. See question number 20 for more information.
◉ Why have a soft cap? Answer: A soft cap promotes a team's ability to
retain its own players. Nobody likes it when a player plays with one
team his entire career, the fans love him, he wants to stay and the team
wants to keep him, but he has to leave because the team cannot offer him
a satisfactory contract. The exceptions under a soft cap allow teams to
keep players under these kinds of circumstances. In addition, they allow
teams to make a limited number of changes (replacing department
players, improvements, etc.) every year.
◉ What is the Collective Bargaining Agreement? Answer: - [ ] It's the
legal contract between the league and the players association that sets up
the rules by which the league operates. (It's commonly abbreviated as
"CBA," which is not to be confused with either the Chinese Basketball
, Association or the Continental Basketball Association. The abbreviation
CBA will be used in the remainder of this document.)
The CBA defines the salary cap, the procedures for determining how it is
set, the minimum and maximum salaries, the rules for trades, the
procedures for the NBA draft, and hundreds of other things that need to
be defined in order for a league like the NBA to function.
The CBA also prevents the NBA from being in violation of federal
antitrust laws. Many of the league's practices (such as the salary cap and
draft) would violate antitrust laws were they not agreed to via collective
bargaining (see question number 118).
◉ Has there always been a salary cap? Answer: It may surprise you to
learn that the NBA first had a salary cap in 1946-47, its first season. The
cap that season was $55,000, with most players earning between $4,000
and $5,000. Star player Joe Fulks earned $8,000, and Tom King earned a
league-highest $16,500 for his combined duties as player, publicity
director and business manager for the Detroit Falcons.
The "modern" NBA salary cap began in 1984-85, at $3.6 million. It
made steady but gradual increases of around $1-2 million each season
until 1994-95, when it was $15.964 million. Armed with a big TV
contract from NBC, the salary cap jumped to $23.0 million in 1995-96,
and increased to $26.9 million in 1997-98, the last season of the 1995
CBA (a 647% increase in 13 years). The ABC/ESPN TV contract, which
took effect with the 2002-03 season, provided $4.6 billion over six
years, but less in 2002-03 than NBC paid in 2001-02. As a result, the
salary cap went down for the first time ever in 2002-03.
Under the 2005 CBA the salary cap started at $49.5 million, and finished
at $58.044 million, a 17.26% increase, and averaging 3.45% per year.
