SUMMATIVE TEST BUSINESS ETHICS 2025

What is the primary role of a business?

• To create wealth for its stakeholders

• To provide government services and income

• To ensure labor equality

• To regulate market competition

Who among the following is responsible for supervising business organizations' activities and operations?

• Department of Trade and Industry (DTI)

• Securities and Exchange Commission (SEC)

• Bureau of Internal Revenue (BIR)

• Department of Labor and Employment (DOLE)

What does 'division of labor' mean in a business context?

• The reduction of working hours to increase productivity in the company

• The fair distribution of wages among employees

• The hiring of more workers to perform similar tasks

• The process of assigning specialized tasks to improve efficiency

If a farmer specializes in growing mangoes and relies on another entrepreneur for transportation, what economic principle is being demonstrated?

• Business Monopoly

• Market Competition

• Consumer Protection

• Division of Labor

A business earns profits and distributes a percentage of them to stockholders, while also paying taxes to the government. What is the significance of this process?

• It helps businesses remain competitive in the market

• It ensures wealth is only circulated within private corporations in the Philippines

• It allows businesses to contribute to socioeconomic development

• It prevents government intervention in corporate affairs

Some enterprising Filipinos send commercial goods through balikbayan boxes to avoid taxes. Should these balikbayan boxes be taxed? Why or why not?

• Yes, because they are being used for commercial purposes rather than personal use

• No, because all balikbayan boxes should remain tax-free regardless of content

• Yes, because the government needs more revenue from overseas shipments

• No, because taxing balikbayan boxes will negatively impact OFWs' families

What does fairness in corporate governance primarily focus on?

• Prioritizing the interests of investors over employees

• Making decisions free from discrimination and bias

• Increasing profitability without regard to employees' rights

• Maintaining secrecy in decision-making processes

How does accountability contribute to corporate governance?

• It allows organizations to hide their activities from stakeholders

• It focuses solely on reporting financial profits

• It discourages employees from seeking feedback on their performance, hindering growth and improvement opportunities.

• It involves disclosing the results of activities and accepting responsibility for them

What is the importance of transparency in corporate governance?

• It allows organizations to keep all decisions private

• It eliminates the need for accountability

• It ensures that the organization's messages are authentic and clear to stakeholders

• It limits the amount of information being shared with the public, reducing transparency and awareness.

If a company is found to have misused funds and hidden this information from its stakeholders, which core principle of corporate governance has likely been violated?

• Fairness

• Accountability

• Transparency

• Stewardship