Eight questions in the style of the New Mexico Business and Law Examination. Each card hides its answer, so pick yours first, then tap to reveal and read the explanation. This is a study warmup. The free 12-question practice quiz is the scored version, with email results.
Question 1
A handyman does casual repair work for a single client, earning $6,800 in a year. He does not advertise as a contractor and has filed his annual declaration. Which statement is most accurate?
- A. He needs a contractor license because he earned over $5,000
- B. He is exempt from licensure under the $7,200 casual-work exemption
- C. He is exempt only if the work was electrical or plumbing
- D. The exemption applies only to farm and ranch work
Question 2
A New Mexico contractor has $80,000 in gross receipts subject to tax for the quarter. At the current state rate, the gross receipts tax due is:
- A. $4,000, at the old 5% rate
- B. $3,900, at the 4.875% state rate
- C. $4,100, at the 5.125% trigger rate
- D. $0, because construction receipts are exempt
Question 3
A New Mexico state agency awards a public-works construction contract for $40,000. Which bonds are required?
- A. None, because the contract is under $100,000
- B. A performance bond at 100% and a payment bond at 100% of the contract price
- C. A payment bond only, at 50% of the contract price
- D. A performance bond only, at 100% of the contract price
Question 4
An original contractor completes a commercial project on March 1 and has not been paid. By when must the mechanics lien claim be filed?
- A. Within 90 days after completion
- B. Within 120 days after completion of the contract
- C. Within 60 days after completion
- D. Within 2 years after completion
Question 5
An owner receives an undisputed payment request from a contractor on a private commercial project. Under the Prompt Payment Act, the owner must pay within:
- A. 7 days
- B. 15 days
- C. 21 days, with interest beginning on day 22 at 1.5% per month
- D. 30 days, with interest beginning on day 31
Question 6
An applicant wants to serve as the qualifying party for a GB-98 license. She has 3 years of practical trade experience in the last 10 years and one year of technical training. Which statement is correct?
- A. She qualifies, because training plus experience totals 4 years
- B. She does not qualify, because training counts only half a year per year, giving her 3.5 years
- C. She qualifies, because the commission must reduce the requirement to 2 years
- D. She does not qualify, because qualifying parties must be 21
Question 7
A contractor's $10,000 license bond lapses on June 1 and is not replaced. On July 15 the Division moves against the license. Which statement is most accurate?
- A. The license is automatically canceled the day the bond lapses
- B. The license is subject to revocation because the bond was not replaced before the 40th day
- C. The contractor has 2 years to replace the bond before any action
- D. No action is possible because the surety gave 30 days' notice
Question 8
A contractor wins a New Mexico state contract to renovate a public school for $75,000. Which statement about prevailing wage is correct?
- A. Prevailing wage does not apply because the contract is under $100,000
- B. Prevailing wage applies because the contract exceeds $60,000, and covered workers must be paid at least weekly
- C. Prevailing wage applies only to federal projects
- D. Prevailing wage applies, but workers may be paid monthly
These eight cover the exam's favorite territory: the exemption boundary, the tax rate, the Little Miller threshold, the lien deadlines, prompt pay, qualifying-party math, the bond, and prevailing wage. For the full bank of 150 practice questions with cited explanations, plus the tabbing map and study notes, see the New Mexico Business and Law Study Guide. And if you have not yet read what to expect on the exam or the full licensing path, start there.
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