10 exam-style questions with answers and explanations, straight from our 1,030-question bank. Tap an answer to check yourself. When you're ready, take the scored version in the free practice test.
The MS-LBM exam has 50 questions and runs 2 hours.
These 10 free MS-LBM questions are organized by exam domain, so you can see how each part of the Mississippi Law and Business Management Exam blueprint is tested. Reveal the answer and explanation under each question.
A contractor proposes an $18,400 roof replacement on an existing Mississippi single-family home. The work does not include an addition or new dwelling. The contractor has obtained the local permit but holds no MSBOC license, and no licensing exemption applies. Which statement correctly addresses the state licensing requirement?
Correct answer: C - An appropriate MSBOC license is required because the residential roofing contract exceeds $10,000.
The estimate for a tenant-improvement project contains $192,000 in direct costs, $18,000 in project-specific overhead, and $6,000 in allocated home-office overhead. These amounts do not overlap. The company requires a 20% profit margin on the selling price after covering all three cost categories. Ignore taxes and contingency. What bid price meets that requirement?
Correct answer: A - $270,000
Production records show that a four-person paving crew places 72 square yards per crew-hour. A comparable job requires 864 square yards. Each crew member costs $38 per worker-hour, including labor burden. The roller costs $65 per operating hour, excluding its operator, who is already one of the four crew members. Assume the roller runs throughout installation and no overtime or mobilization charges apply. What combined labor-and-roller cost belongs in the estimate?
Correct answer: A - $2,604
"The income statement shows a profit, so why is payroll cash getting tighter?" a contractor asks. Credit sales and job margins are steady, but average receivable days have risen from 34 to 71. Inventory levels and the timing of supplier payments have not changed. Which explanation fits these findings?
Correct answer: A - More earned revenue remains tied up in customer receivables instead of arriving as cash.
A Mississippi prime contractor is pricing a $240,000 addition to a county-owned public library. The county purchasing officer says the county's tax-exempt status should eliminate the contractor's tax. No project-specific statutory exemption applies. How should the contractor treat the contract for Mississippi contractor's tax purposes?
Correct answer: B - Apply the 3.5% contractor's tax to the entire taxable contract amount.
On her first day, a newly hired carpenter presents an unexpired U.S. passport for Form I-9. The employer examines the original document; it reasonably appears genuine and relates to her. The office manager wants to withhold her jobsite assignment until she also produces a Social Security card. For Form I-9 purposes, how should the employer proceed?
Correct answer: B - Accept the passport and complete Section 2 without requiring a second document.
An earned-value report shows a cost performance index (CPI) of 1.12 and a schedule performance index (SPI) of 0.83. The superintendent argues that favorable spending means the project is ahead of schedule. The report actually supports which interpretation?
Correct answer: D - Completed work is cost-efficient, but less budgeted work has been accomplished than planned.
A private construction contract permits the owner's authorized representative to issue a signed directive requiring changed work before price agreement. The contractor must proceed and give written notice of any price or time claim within seven calendar days of the directive. A valid directive arrives today; the work is safe and feasible, but the parties disagree about its price. Which response preserves the contractor's position without breaching the stated procedure?
Correct answer: C - Proceed with the directed work, track its costs, and give the required written claim notice.
The sole member of a Mississippi LLC signs an enforceable personal guarantee of the company's supplier account. The LLC later fails to pay for delivered materials. The member argues that the invoices name only the LLC, so the supplier cannot pursue him personally. Which statement correctly addresses his exposure?
Correct answer: D - The personal guarantee creates an obligation separate from his status as an LLC member.
After a rainstorm, the competent person finds new cracks and soil sloughing along a 4.5-foot-deep trench where two employees are connecting pipe. The trench has safe ladder access but no cave-in protective system; the earlier inspection had found no indication of a cave-in hazard. The foreman says only ten minutes of work remain. What must happen first?
Correct answer: D - Remove the employees until precautions protect them against the changed cave-in hazard.
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