Deck 9: Bonds

Question 1

In construction, there are three basic types of bonds: Bid, Performance, and Payment

Answer 1

True

Question 2

Based on the Miller Act, bonds are required

A) on Federal work greater than $100K
B) on all Federal work
C) on projects over one million dollars
D) only on Federal military work

Answer 2

A

Question 3

Joint ventures are sometimes formed

A) to increase bonding capacity for a particular project
B) to combine different expertise within different companies
C) to provide more capital for cash flow
D) all of these

Answer 3

D

Question 4

A responsive bid

A) contains a good price for what is expected to be done
B) is the low bid
C) is by a contractor capable of doing the work
D) is any bid that contains all the elements required to be submitted in the bid package

Question 5

A responsible bid

A) contains a good price for what is expected to be done
B) is the low bid
C) is by a contractor capable of doing the work
D) is any bid that contains all the elements required to be submitted in the bid package

Question 6

The three C's of bonding include Capital, Competence and

A) Character
B) Charisma
C) Convenience
D) Caution

Question 7

Failure to inform of a claim against a bond in a timely matter can negate the chance of collecting money that is due

Question 8

The bonding company is often concerned about the health of a key individual in a firm they provide bonds for

Question 9

Performance and payment bonds are usually issued after a bid bond

Question 10

Bonds are another form of insurance

Question 11

The three Cs of bonding are Character, Capital and Commitment

Question 12

A Responsive bidder has filled the forms of the proposal out correctly

Question 13

A responsible bidder is one that has the ability to do the work being bid

Question 14

The Miller Act requires bonding on Federal Projects above a specific dollar volume

Question 15

Second-tier Subcontractors are also referred to as Sub-subcontractors

Question 16

A Cardinal change is an important change of work that the Owner wants the Contractor to perform or process as soon as possible

Question 17

Payment bonds

A) assure lower-tiered Contractors they will be paid
B) bind the Owner and the Contractor to mutual exchange of money in the event of a Subcontractor default
C) are calculated based on the amount of risk involved in the project
D) are required on any project that has a Pay if Paid clause