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Practice and exam technique

Practice questions: procurement and contracting

Compiled by the Sitonce editorial team from the PSI Candidate Information Bulletin, NASCLA's own published material and the federal standards named belowUpdated 2 min readFacts verified 4 September 2026
The short answer

Procurement and Contracting is 31 of 115 scored questions. These four cover the order of precedence, bond types, retainage and the markup-margin distinction.

The largest category and the one most candidates are weakest on. Four to work through.

Question 1

The drawings show a 4 inch slab and the specifications call for 5 inches. The contract states a conventional order of precedence and no addendum addresses it. Which governs?

  1. The drawings, as they show the actual construction
  2. The specifications
  3. Whichever is more expensive
  4. Neither, until an RFI is answered
Answer: B. Specifications generally prevail over drawings because words describe quality more precisely than lines do. Option D is good practice - you should raise an RFI - but the question asks which document governs, and that is settled by the order of precedence.
Question 2

A subcontractor on a public school project has not been paid. The general contractor is solvent but disputing the invoice. What is the subcontractor's primary remedy?

  1. A mechanics lien against the school
  2. A claim against the payment bond
  3. A claim against the performance bond
  4. A stop notice against the architect
Answer: B. Public property generally cannot be liened, which is precisely why payment bonds are required on public work. The performance bond in option C guarantees completion to the owner, not payment to subcontractors.
Question 3

A contract provides for 10 percent retainage. On a payment application of 100,000 dollars for work completed, how much is withheld?

  1. 1,000 dollars
  2. 10,000 dollars
  3. 9,000 dollars
  4. Nothing until substantial completion
Answer: B. 10 percent of 100,000 is 10,000. Option A is one percent, which is the error from misplacing the decimal under time pressure.
Question 4

A contractor needs a 20 percent margin on price. What markup on cost achieves it?

  1. 20 percent
  2. 25 percent
  3. 16.7 percent
  4. 30 percent
Answer: B. A 25 percent markup on cost produces a 20 percent margin on price. Option A is the answer somebody gives by assuming markup and margin are the same, which underprices every job. Option C is the margin a 20 percent markup actually produces.

What these test

Two are concepts and two are arithmetic. Neither kind is answered by searching a book for a sentence, which is why this category rewards understanding more than tabbing.

Common questions

How many procurement questions are on the exam?

31 of the 115 scored questions, the largest category.

Do specifications beat drawings?

Generally yes, because words describe quality more precisely than lines.

What is a subcontractor's remedy on public work?

A claim against the payment bond, since public property generally cannot be liened.

What markup gives a 20 percent margin?

25 percent.

Are these lookup questions?

Mostly not. This category rewards understanding, since concepts and arithmetic are not found by searching.

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