A Melbourne bond premium estimate applies a 1.60% rate to a $315,000 bond amount. What premium should be budgeted?
Correct Answer
C) $5,040.00
The bond premium estimate equals bond amount multiplied by the premium rate.
Why This Is the Correct Answer
The bond premium estimate equals bond amount multiplied by the premium rate.
Why the Other Options Are Wrong
Option A: $504.00
$504.00 is below the supported result for bond premium estimate; it likely skips a premium-pay or employer-cost component.
Option B: $320,040.00
$320,040.00 is above the supported result for bond premium estimate; it likely pays the wrong premium tier or counts the same hours twice.
Option D: $6,615.00
$6,615.00 is above the supported result for bond premium estimate; it likely pays the wrong premium tier or counts the same hours twice.
Memory Technique
Bond ladder for Bid Coordinator: hours climb before dollars add up.
Reference Hint
Open-book path: tab Contractor's Manual, 2025 to Business Administration, Bond Premium Administration; verify the record, approval, or control duty before selecting the answer.
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