Virginia Contractor General Test 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 400

What is the value of the Max Bond based on Working Capital?

Working Capital x 5

Working Capital x 10

The value of the Max Bond based on Working Capital is determined by the industry standard for how much bonding capacity a contractor can secure based on their working capital. Typically, bonding companies assess a contractor's financial health, and for working capital, a common multiplier used is 10. This means that if a contractor has a certain amount of working capital, they may be eligible for a bond that is up to ten times that amount.

This multiplier takes into account the contractor's ability to manage operational costs and complete projects without financial strain, providing a safeguard for the bonding company in case of claims. Therefore, using the working capital and multiplying it by 10 reflects a standard bonding capacity, making this choice the right answer. The other multipliers suggested in the options represent less common valuations and are not typically utilized in the bonding process.

Get further explanation with Examzify DeepDiveBeta

Working Capital x 15

Working Capital x 20

Next Question

Report this question

Download Virginia Contractor General Test 2025 – 400 Free Practice Questions to Pass the Exam PDF Study Guide
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy