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North Carolina Business and Law Exam — General Contractors Practice Test

What This Practice Exam Covers

This practice test is built for the North Carolina Business and Law Exam for General Contractors — 40 questions, 90 minutes, 70% to pass.

You have two options here.

Free practice exam: 10 questions per attempt, pulled from a limited question pool. You can retake it as many times as you want. Use it to get a feel for how questions are phrased and which topics give you trouble before you commit to serious study.

Full practice exam (paid): 40 questions, 90-minute clock, drawn from a pool of 159+ questions. Every attempt pulls a different set, so you won't see the same exam twice. The questions are mapped to the exact topic breakdown that the official test provider uses. If you're preparing in earnest, this is the tool that tells you whether you're actually ready.

Start with the free exam. Use the full exam to finish the job.

What You'll Be Tested On

The exam covers five topic areas. Here's what each one actually demands from you.

Licensing — 21 of 40 questions

This is more than half the exam. Do not shortchange it.

You need to know the six license classifications: Building, Residential, Highway, Public Utilities, Specialty, and Unclassified — and which types of work each covers. You also need to know the three limitation tiers (Limited, Intermediate, Unlimited) and the working capital or surety bond thresholds that go with each.

Questions hit the qualifier role hard. Know what a qualifier does, what exams they must pass, and what happens when a qualifier leaves a company. The application process questions cover required documentation — character references, criminal background checks, financial statements — and fees.

Expect questions on renewal, continuing education, and what "inactive" versus "invalid" status means for a license. Disciplinary questions ask you to identify what conduct triggers Board action and what enforcement tools the Board can use. Unlicensed practice penalties appear regularly.

References the question bank actually cites include Appendix E, G.S. 87-10(b)(3)(e); Appendix E, G.S. 87-13; Appendix F, 21 NCAC 12A .0202(a)(1); Appendix F, 21 NCAC 12A .0205(a) through (g); and NASCLA Contractors Guide, Appendix F, 21 NCAC 12A .0501(a), among others.

Liens and Bonds — 8 of 40 questions

Know the lien rights by contract tier: owners, first-tier subcontractors, second-tier, third-tier, and remote parties have different rights and different deadlines. The exam tests the lien agent system specifically — when an owner must designate a lien agent, how notice to the lien agent works, and what happens if a party fails to serve that notice.

Filing and perfecting a claim of lien means knowing the contents required, the deadlines, and where to file. Notice of contract and notice of subcontract are tested separately — know the form requirements and timing for each. Lien foreclosure deadlines and discharge methods (satisfaction, bonding around a lien) also appear.

Key citations include Appendix M, §44A-11.1; Appendix M, §44A-11.2(l)(1); Appendix M, §44A-13(a); and NASCLA Contractors Guide, Appendix M, Pages M-4 to M-5 (§44A-11.2(b) and (b1)).

One Call — 5 of 40 questions

You must notify NC811 at least three full working days before excavating, within a 3-to-12 working day window. Know the difference between normal, update, retransmit, emergency, report of damage, destroyed marks, design/survey, and three-hour notification types — the exam asks you to pick the right one for a described situation.

The Positive Response System is tested directly. Know what the codes mean before you dig. The APWA uniform color code for marking underground facilities is fair game — know which color covers which utility type. Tolerance zone rules and what you must do (and not do) inside the tolerance zone are tested as well.

Citations include NC811 Excavation Guide, Chapter 4 — Positive Response Codes; NC811 Excavation Guide, Chapter 6 — APWA Uniform Color Code for Utilities; and NC811 Excavation Guide, Chapter 10 (G.S. 87-122(a)).

Subcontractor Payment Requirements — 3 of 40 questions

Three questions, but they're specific enough that a single missed rule costs you. Know the seven-day payment rule from NCGS 22C-3: once a contractor receives payment, the sub gets paid within seven days. Pay-if-paid and pay-when-paid clauses are prohibited under NCGS 22C-2 — know this cold. Know the permissible grounds for withholding payment under NCGS 22C-4, the interest penalty on late payments under NCGS 22C-5, and which contracts are exempt under NCGS 22C-6.

Erosion and Sedimentation Control — 3 of 40 questions

Know the plan requirements and approval process under the Sedimentation Pollution Control Act of 1973, including applicability and exemptions. Buffer zone requirements, grading slopes, and ground cover timelines under mandatory standards are tested. Design standards for erosion control measures reference 10-year and 25-year storm events — know which standard applies where. Self-inspection requirements and the civil and criminal penalty structure round out this topic.

Cited references include NCGS 113A-57(2); NCGS 113A-57(4); NCGS 113A-60(b); 15A NCAC 04B .0124(c)(4); and 15A NCAC 04B .0125(c).

Worked Sample Questions

Question 1 — Licensing

A contractor licensed in Georgia wants to obtain a North Carolina general contractor license using reciprocity. In addition to completing the application process, what examination must this contractor pass before the license is issued?

• A. The full NASCLA commercial examination
• B. The North Carolina Law and Regulation Exam
• C. The PSI general knowledge examination
• D. The Georgia trade examination again

Correct answer: B

North Carolina has reciprocal agreements with several states, including Georgia. Even when a contractor qualifies for a reciprocal exam waiver or has passed the NASCLA exam, the North Carolina Law and Regulation Exam is still required before the license is issued. The trade exam may be waived; the NC-specific law exam is not. Source: NASCLA Contractors Guide, Chapter 3 (Becoming a Licensed Contractor); 21 NCAC 12A .0303(c).

Question 2 — Liens and Bonds

A contractor files a notice of contract within 30 days of permit issuance, and a second-tier subcontractor serves a notice of subcontract on the contractor. After the notice of subcontract is served, within how many days of each subsequent payment must the contractor notify the subcontractor of that payment?

• A. Three days
• B. Ten days
• C. Five days
• D. Seven days

Correct answer: C

Once a signed notice of contract is posted and filed and a signed notice of subcontract has been served, the contractor must serve written notice of each subsequent payment on the subcontractor within five days following each payment. That notice must set out the date and the period covered by the payment. Three, seven, and ten days are all wrong. Source: NASCLA Contractors Guide, Appendix M, Pages M-17 to M-18 (§44A-23(b)(1)(b)).

Question 3 — One Call

You are a general contractor checking the NC811 Positive Response System before starting excavation. One utility operator's response is code 40. What does this code indicate?

• A. No conflict; utility is outside the work area
• B. Facility has been marked in the field
• C. Locator could not access the property
• D. Locate request is not yet complete

Correct answer: C

Code 40 means the locator could not gain access to the property and will contact the excavator. Do not dig until that contact happens and access is arranged. For comparison: code 10 means no conflict, code 20 means marked, code 30 means the locate is not yet complete. Source: NC811 Excavation Guide, Chapter 4 — Positive Response Codes.

How to Read Your Score

Passing the real exam requires 70% — that's 28 correct out of 40.

Your first practice attempt is a diagnostic. Don't treat a low score as a verdict. Treat it as a map. The topic-by-topic breakdown tells you where your time goes next. If you're missing Licensing questions, that's 21 points of exposure — fix it first. If Liens and Bonds are fuzzy, that's eight questions you're leaving on the table.

Scoring in the low 70s on practice usually means you're not ready yet. The real exam doesn't have questions in the same order, and pressure changes how you read answer choices. Aim for consistent scores in the upper 70s or low 80s before you schedule the real test. A score in the 60s means go back to source material, not just more practice questions.

Use each attempt to measure progress, not to predict your exact pass/fail. The pool has 159+ questions — retake the full exam more than once.

Where Candidates Lose Points

Licensing details trip people up most. With 21 questions on the line, a vague understanding of qualifier responsibilities or limitation tier thresholds costs real points. Know the specific numbers and conditions — not just the concept.

Lien deadlines get confused. Candidates mix up notice of contract timing, notice of subcontract requirements, and lien perfection deadlines. These are separate acts with separate clocks. Treat each one as a distinct rule.

One Call notification types are misread. Candidates pick "normal" when the scenario calls for "retransmit" or "update," or they miss that the 3-to-12 working day window has both a minimum and a maximum. Read the scenario carefully before answering.

Subcontractor payment rules get reversed. The seven-day rule runs from contractor receipt of payment — not from the invoice date, not from project completion. Pay-if-paid clauses are prohibited, full stop. Candidates who half-remember this guess wrong.

Erosion control storm standards get swapped. Know which design standard (10-year vs. 25-year storm) applies to which type of measure. Swapping them is a one-question mistake that's easy to avoid if you review the rule once.

Time management matters too. Licensing is heavy — 21 questions. Don't burn 45 minutes on it and rush the back half.

Exam Quick Facts