Free BUSINESS AND LAW Practice Questions

Sample Practice Questions

Try these 10 sample questions from the BUSINESS AND LAW practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

1. 1A grading project will disturb 1.4 acres on one tract. Under North Carolina's baseline rule, when must the erosion and sedimentation control plan be filed?

   1. A. At least 30 days before disturbance begins
   2. B. At least 15 days before disturbance begins
   3. C. Within 30 days after disturbance begins
   4. D. Before final stabilization

   Answer: A

   Explanation: N.C. Gen. Stat. § 113A-57(4) says, "30 or more days prior to initiating the activity, an erosion and sedimentation control plan for the activity is filed." The 1.4-acre activity crosses the statutory threshold.

   Reference: Ncgs Chapter 113 a — § 113A-57(4), pp. 20-21

2. 2At what project cost does a person generally become a North Carolina general contractor under G.S. 87-1?

   1. A. $30,000 or more
   2. B. $40,000 or more
   3. C. More than $50,000
   4. D. $75,000 or more

   Answer: B

   Explanation: G.S. 87-1(a) covers construction "where the cost of the undertaking is forty thousand dollars ($40,000) or more."

   Reference: Ncgs Chapter 87 — G.S. 87-1(a), p. 4

3. 3Which payment-related basis is barred when a subcontractor has performed according to its contract?

   1. A. Unsatisfactory progress on the subcontract work
   2. B. Defective construction that remains uncorrected
   3. C. Owner payment stated as a condition precedent
   4. D. Documented third-party claims involving the subcontractor

   Answer: C

   Explanation: G.S. 22C-2 says owner payment is not a condition precedent to subcontractor payment and "an agreement to the contrary is unenforceable." The other choices correspond to withholding grounds in G.S. 22C-4.

   Reference: Ncgs Chapter 22 C — G.S. 22C-2, p. 1

4. 4Who may claim the direct real-property lien described in G.S. 44A-8 after complying with Article 2?

   1. A. An owner-contracted provider of covered labor, services, materials, or rental equipment
   2. B. A mortgage lender holding a deed of trust
   3. C. A judgment creditor holding a recorded judgment
   4. D. A commercial broker claiming an earned commission

   Answer: A

   Explanation: G.S. 44A-8 grants the right to a person who supplies covered labor, services, materials, or rental equipment "pursuant to a contract, either express or implied, with the owner."

   Reference: Ncgs Chapter 44 a — G.S. 44A-8, p. 9

5. 5Which North Carolina One Call notice cannot be used to authorize excavation?

   1. A. Design notice
   2. B. Excavation notice
   3. C. Emergency notice
   4. D. Subsequent notice

   Answer: A

   Explanation: G.S. 87-117(6) states, "A design notice may not be used for excavation purposes."

   Reference: Ncgs Chapter 87 — G.S. 87-117(6), p. 66

6. 6A contractor completes one phase of grading and leaves the slope exposed. What is the North Carolina deadline for providing temporary or permanent ground cover?

   1. A. 7 calendar days
   2. B. 14 calendar days
   3. C. 21 calendar days
   4. D. 30 calendar days

   Answer: C

   Explanation: Section 113A-57(2) requires exposed slopes to be covered "within 21 calendar days of completion of any phase of grading."

   Reference: Ncgs Chapter 113 a — § 113A-57(2), p. 20

7. 7A firm erects a North Carolina-labeled manufactured modular building. Does the $40,000 threshold determine whether it is treated as general contracting?

   1. A. No; erecting that modular building is independently included
   2. B. Yes; only projects over $40,000 are included
   3. C. Yes; unless the building is residential
   4. D. No; modular buildings are always exempt

   Answer: A

   Explanation: G.S. 87-1(a) separately includes anyone who "undertakes to erect a North Carolina labeled manufactured modular building meeting the North Carolina State Building Code."

   Reference: Ncgs Chapter 87 — G.S. 87-1(a), p. 4

8. 8After receiving a periodic payment attributable to a compliant subcontractor's work, how soon must the contractor pay that subcontractor?

   1. A. Within 3 days
   2. B. Within 7 days
   3. C. Within 15 days
   4. D. Within 30 days

   Answer: B

   Explanation: G.S. 22C-3 requires payment "within seven days of receipt" of each periodic or final payment.

   Reference: Ncgs Chapter 22 C — G.S. 22C-3, p. 1

9. 9To what does a statutory claim of lien on real property generally extend?

   1. A. All contiguous land held by the owner
   2. B. The improvement and qualifying lot or tract to the extent of the owner’s interest
   3. C. Any parcel selected by the claimant regardless of ownership
   4. D. The improvement and the contractor’s personal property

   Answer: B

   Explanation: G.S. 44A-9 provides that the lien extends "to the improvement and to the lot or tract on which the improvement is situated, to the extent of the interest of the owner."

   Reference: Ncgs Chapter 44 a — G.S. 44A-9, p. 9

10. 10If an underground facility's diameter is known, how is its tolerance zone measured from the designated center line?

    1. A. The full diameter plus 12 inches on each side
    2. B. One-half the known diameter plus 24 inches on each side
    3. C. Exactly 24 inches total
    4. D. Fifteen feet on each side

    Answer: B

    Explanation: G.S. 87-117(22) defines it as "one-half of the known diameter plus 24 inches on either side" of the center line.

    Reference: Ncgs Chapter 87 — G.S. 87-117(22), p. 67