Every applicant for a North Carolina general contractor license has to clear the Business and Law exam before the Licensing Board will issue a license. It is a separate, standalone test from the trade knowledge exam, and it is built entirely around North Carolina’s own statutes and administrative rules rather than a single trade skill. Here is what the exam covers, how it is scored, and what to expect on test day.
What is the North Carolina contractor Business and Law exam?
It is a proficiency test administered by PSI Examination Services at any PSI test center, required of every applicant for a North Carolina general contractor license regardless of the classification (Limited, Intermediate or Unlimited) or license type being sought. It is scored on its own, separately from the trade knowledge portion of licensure.
How many questions are on the exam and how long do you get?
The exam has 40 scored multiple-choice questions, each with one best answer, and you get 90 minutes to complete them. The pass mark is 70 percent, which works out to 28 of the 40 questions correct.
- Questions: 40 scored, multiple choice
- Time limit: 90 minutes
- Pass mark: 70 percent (28 of 40)
Is the exam open book?
Yes, the Business and Law exam is open book. You may bring the approved bound references to the test center, but only permanent tabs are allowed: no adhesive sticky flags and no handwritten notes on the tabs themselves. A silent, non-programmable calculator is also permitted. Being open book does not make the exam easy, since 90 minutes for 40 questions leaves little time to hunt through a reference you do not already know your way around.
What topics does the exam cover?
The 40 questions are drawn from five subject areas, weighted heavily toward licensing law.
- Licensing: 21 questions, from Chapter 87 of the General Statutes and the Licensing Board’s own rules, covering classifications, qualifying party requirements and working capital thresholds.
- Liens and Bonds: 8 questions, from Chapter 44A, covering claims of lien on real property and the deadlines to file and enforce them.
- One Call: 5 questions, from the Underground Utility Safety and Damage Prevention Act, covering excavation notice requirements to the NC811 center.
- Erosion and Sedimentation Control: 3 questions, from the Sedimentation Pollution Control Act of 1973.
- Subcontractor’s Pay Requirements: 3 questions, from Chapter 22C, covering payment deadlines and interest owed on late payments.
When do you actually need a North Carolina general contractor license?
A license is required once the cost of the undertaking reaches 40,000 dollars or more. That threshold was raised from 30,000 dollars effective 1 October 2023, so any older prep material still citing 30,000 dollars is out of date on this point. It is worth noting the separate lien agent requirement in Chapter 44A still applies starting at 30,000 dollars, a different figure the exam expects you to keep straight from the licensing threshold.
How much does the exam cost, and can you retake it?
The exam fee is 79 dollars per attempt. There is no limit on retakes within a 12-month period, and your eligibility letter to sit the exam is valid for 120 days. If you do not pass, you are offered a 30-minute review of the items you missed.
How should you prepare?
Because the questions are drawn from enacted statutes and administrative rules rather than a proprietary question bank, the most direct preparation is working through those five subject areas in the same proportions the exam uses: heaviest on licensing, then liens and bonds, then the smaller One Call, erosion control and subcontractor pay sections. Since the exam is open book, practising with the actual dollar thresholds, filing deadlines and notice periods matters more than memorizing statute numbers, so you can locate the right answer quickly under the 90-minute clock.
The RiverMap Learning North Carolina Contractor Business and Law app is built from North Carolina’s own public domain statutes and administrative rules, not the copyrighted NASCLA study guide. It covers all five subject areas with practice questions, full 40-question mock exams scored at the real 70 percent pass mark, and flashcards for the deadlines and thresholds the open-book exam expects you to find fast. It is an independent study tool and is not affiliated with or endorsed by the State of North Carolina, the North Carolina Licensing Board for General Contractors, or PSI.