Preliminary Examination

BUSINESS LAW AND REGULATION

Name: ________________________________ Score: ____________________

Course: ______________ Time/Schedule: ____________

Test I. MODIFIED IDENTIFICATION

Direction: Choose the appropriate answer to the following descriptions.

1. It is the law of religion and faith which concerns itself with the concept of sin and salvation

a. Natural Law

b. Moral Law

c. Physical Law

d. Divine Law

2. It is the totality of the norms of good and right conduct growing out of the collective sense of right and wrong
of every community.

a. Natural Law

b. Moral Law

c. Physical Law

d. State Law

3. It is often referred to as the fundamental or supreme law or highest law of the land because it is promulgated
by the people themselves, binding on all individual citizens and all agencies of the government.

a. Legislation

b. Judicial

c. Constitution

d. Customs

4. It consists of those habits and practices which through long and uninterrupted usage have become
acknowledged and approved by the society as binding rules of conduct.

a. Legislation

b. Judicial

c. Constitution
d. Customs

5. It is the law governing local taxation in the Philippines, including the taxation on real properties.

a. Intellectual Property Code of the Philippines (R.A. 8293)

b. The Local Government Code of the Philippines (Republic Act No. 7160)

c. Labor Code of the Philippines (Presidential Decree No. 442)

d. Tax Reform Act of 1997 (Republic Act No. 8424)

6. These are a set of principles that determine what is right, wrong, and appropriate in the workplace.

a. Ethics

b. Business ethics

c. Rules

d. Responsibilities

7. It can be defined broadly as the study of what is right or good for human beings that attempts to determine
what people ought to do, or what goals they should pursue.

a. Ethics

b. Business ethics

c. Rules

d. Responsibilities

8. A form of utilitarianism that assesses each separate act according to whether it maximizes pleasure over
pain.

a. Rue utilitarianism

b. Utilitarianism

c. Act utilitarianism

d. None of the above

9. It holds that a rational person possesses inherent powers to assess the correctness of actions.

a. Intuitionism

b. Social egalitarians

c. Deontology

d. Absolutism

10. This principle includes telling the truth, being transparent, and taking ownership of your words, work and
actions.

a. Loyalty

b. Trustworthiness
c. Honesty

d. Respect

Test II. MULTIPLE CHOICES

Direction: Select the response that best answer the question or statement.

11. Divine law comprises anybody of law that is perceived as deriving from a transcendent source, such as the
will of God or gods. Which of the following does not illustrate a divine law?

a. The Commandments of the TipsyDrunkers.

b. Shaira law and Quran

c. The Code of Hammurabi

d. The 10 commandments in the Hebrew Bible

12. Which of the following is the sanction of divine law?

a. The divine law has no definite legal sanction.

b. The sanction of divine law lies in the assurance of certain rewards and punishments in the present life
or in the life to come.

c. The sanction of divine law lies in the pleasures and pains, reward and penalties

d. None of the above.

13. Which of the following illustrates an example of natural law?

a. Killing human being is wrong

b. Newton’s law of motion

c. Ten Commandments

d. All of the above

14. Which of the following is not a characteristic of law?

a. It is a law of conduct

b. It is not obligatory

c. It is promulgated by legitimate authority

d. It is of common observance and benefit

15. Which of the following sources of is the highest law of the land because it is promulgated by the people
themselves, binding all individual citizens and all agencies of the government?

a. Legislation

b. Administrative

c. Constitution
d. Jurisprudence

16. Which of the following does not describe the law?

a. Law regulates the relations of men to maintain harmony in society.

b. Law means any rule of action or any system of uniformity.

c. Law is a set of rules decided by a particular place or authority meant for the purpose of keeping the
peace and security of society

d. Law is made by the people only

17. Which of the following Act that governs the supervision and regulation of the establishment and operation
of all facilities utilized for breeding, maintaining, keeping, treating, or training of all animals in the Philippines.

a. Financing Company Act of 1998 (R.A. No. 8556)

b. The Animal Welfare Act of 1998 (R.A. No. 8485)

c. The Philippine Fisheries Code (R.A. No. 8550)

d. Food and Drug Administration (FDA)

18. Which of the following act require the Disclosure of Finance Charges in Connection with Extensions of
Credit?

a. Truth in Lending Act (R.A. No. 3765)

b. Securities Regulation Code of the Philippines (R.A. No. 8799)

c. Anti-Money Laundering Act of 2001 (RA 9160)

d. The Anti-Red Tape Act of 2007 (RA 9485)

19. Which of the following law that governs the registration and regulation of securities, pre-need plans, and
securities market professionals and the protection of shareholder interests in the Philippines?

a. Food and Drug Administration (FDA) Act of 2009 (R.A. No. 9711)

b. Securities Regulation Code of the Philippines (R.A. No. 8799)

c. Civil Law of the Philippines (R.A. No. 386)

d. Social Security Act of 1997 (R.A. No. 8282)

20. The law on obligation and contract is included in which of the following?

a. Substantive law

b. Private law

c. Public law

d. Procedural law
21. Which level of Kohlberg's moral development, the people conform their behavior to meet the expectations
of groups, such as family, peers, and eventually society?

a. Preconventional

b. Conventional

c. Postconventional

d. None of the above.

22. Which of the following development prevents people from acting on unchecked urges, instead considering
what is right for society and good for others?

a. Ethical

b. Moral

c. Business

d. Personal

23. Which of the following principles of business ethics involves in promoting a positive image of your employer
and organization, especially to clients, co-workers, family, and friends outside the company and on social
media?

a. Integrity

b. Loyalty

c. Respect

d. honesty

24. Which of the following principles of business ethics means performing a task you were assigned to or
agreed to complete, practicing discretion on company information, and being punctual to meetings and other
work events.

a. Integrity

b. Loyalty

c. Trustworthiness

d. honesty

25. Which level of Kohlberg’s moral development where moral principles are voluntarily internalized, not
externally imposed? Moreover, individuals at this stage develop their own universal ethical principles and may
even question the laws and value that society and others have adopted.

a. Preconventional

b. Conventional

c. Post conventional

d. None of the above

a. Business

b. Consequences

c. Law

d. Ethics

27. An electrician working in a small town is the only electrician within a 100-mile radius. He knows that people
who have medical equipment at home have the highest need for power, so he charges them double to fix
problems with their electricity, compared with the average customer. The community is angry about this choice.
This business practice is most likely:

a. Ethical because it is not illegal for a company to set its prices based on maximizing profits.

b. Ethical because owners should focus only on the impact of decisions on the firm.

c. Unethical because businesses operate in a community and communities have expectations for
behaviour of individuals, groups, and businesses.

d. Unethical because it is against the law for a company to charge one customer more than another.

28. Which of the following is true regarding business ethics?

a. Business ethics produces a list of correct business decisions that all ethical businesses will make so
long as the theory of rule utilitarianism is followed.

b. Business ethics produces a list of correct business decisions that all ethical businesses will make so
long as the theory of virtue ethics is followed.

c. Business ethics produces a list of correct business decisions that all ethical businesses will make so
long as the theory of deontology is followed.

d. Business ethics refers to standards of business conduct but does not result in a set of correct
decisions.

29. Which of the following requires that we see murder as moral action as long as the murder believes that the
action is best for him or her?

a. Deontology

b. Ethical relativism

c. Utilitarianism

d. Social theories
30. An ethical theory that urges managers to take those actions that provide the greatest pleasure after having
subtracted the pain or harm associated with the action in question is called which of the following?

a. Utilitarianism

b. Deontology

c. Ethical relativism

d. Absolutism

31. A manager may think it is wrong to terminate a person whose spouse has terminal illness because a
company has an absolute obligation to support its employees when they are vulnerable. With which ethical
theory is the business manager acting consistently?

a. Rule utilitarianism

b. Deontology

c. Ethical fundamentalism

d. Act utilitarianism

32. Which of the following is the difference between laws and ethics?

a. Ethics can be created to make a company look good, even if they don’t follow it, while laws must be
followed

b. There is not a difference between laws and ethics. Both are required

c. Laws are required by the government, while ethics is a set of rules one sets for themselves

d. All of the above

33. Service type firms offer professional skills, expertise, advice, and other similar products. Which of the
following does not include in a service type firm?

a. Salon

b. Repair shop

c. Banks

d. Convenience store

34. Which type of business that combines raw materials, labour, and overhead costs in its production process,
the goods will then be sold to customers?

a. Service Business

b. Merchandising business

c. Manufacturing business

d. Hybrid business
35. Which of the following does not show are substantive rules of law and provide a kind of command or
direction to citizens?

a. Drive not more than fifty-five miles per hour where that speed limit is posted.

b. Do not conspire to fix prices with competitors in the US market.

c. Do not falsely represent the curative effects of your over-the-counter herbal remedy.

d. Do not kill.

36. Which of the following type of business is easy to set-up and is the least costly among all forms of
ownership?

a. Corporation

b. Cooperative

c. Partnership

d. Sole Proprietorship

37. Which of the following is a business that sells a product without changing its form? Examples are: grocery
stores, convenience stores, distributors, and other resellers.

a. Service Business

b. Merchandising business

c. Manufacturing business

d. Hybrid business

38 There are many ways you can have an ethical work environment. Which of the following is not included?

a. Practice Integrity

b. Avoid discussing issues with the management

c. Seek further ethics training

d. Take care of the company property

39. How many levels of moral development are there in each stage?

a. 2

b. 6

c. 4

d. 8

40. How many main stages of moral development are there?

a. 1

b. 5
c. 3

d. 7

Test III. TRUE OR FALSE

Directions: Read each statement below carefully. Select TRUE if you think the statement is true and select
FALSE if you think the statement is false.

41. Businesses are subject to various state and local laws and regulations related to employment, intellectual
property, insurance, and other matters. The type and scope of your business will generally determine which
laws and regulations are applicable.

42. A cooperative is a business organization owned by a group of individuals and is operated for their mutual
benefit. The persons making up the group are called members. Cooperatives may be incorporated or
unincorporated. Some examples of cooperatives are: water and electricity cooperatives, cooperative banking,
credit unions, and housing cooperatives.

43. A partnership is a business owned by two or more persons who contribute resources into the entity. The
partners divide the profits of the business among themselves. In limited partnerships, all partners have
unlimited liability. In general partnerships, creditors cannot go after the personal assets of the limited partners.

44. Anti-Money Laundering Act of 2001 (RA 9160) is an Act that aims to protect and preserve the integrity and
confidentiality of bank accounts and to ensure that the Philippines shall not be used as a money laundering
site for the proceeds of any unlawful activity.

45. Moral Law is the totality of the norms of good and right conduct growing out of the collective sense of right
and wrong of every community. Moral law is not absolute. It varies with the changing times, conditions or
convictions of people.

46. Businesses are artificial entities established to permit people to engage in profit-making, not social,
activities. Without profits, they assert, there is little reason for a corporation to exist and no real way to measure
the effectiveness of corporate activities. Businesses are not organized to engage in social activities; they are
structured to produce goods and services for which they receive money.
47. Kant’s philosophy also rejects notions of the end justifying the means. To Kant, every person is an end in
himself or herself. Each person deserves respect simply because of his or her humanity. Thus, any sacrifice of
a person for the greater good of society would be unacceptable to Kant.

48. Personal Loyalties refers to the personal beliefs of an individual. Every individual has certain firm beliefs on
certain matters’ such as honesty, avoiding criminal acts, obedience to elders, willing to perform accepted
duties, promptly settling the dues etc.

49. Trust is being dependable to clients, supervisors, and other employees. This means performing a task you
were assigned to or agreed to complete, practicing discretion on company information, and being punctual to
meetings and other work events.

50. Trust is being dependable to clients, supervisors, and other employees. This means performing a task you
were assigned to or agreed to complete, practicing discretion on company information, and being punctual to
meetings and other work events.