DIAGNOSTIC TEST

GRADE- 12 BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

S.Y. 2020-2021

Name:_______________________________________ Score: ___________________

Yr. & Section: ________________________________ Date: ____________________

I. MULTIPLE CHOICE (Write the letter of the best answer before the number)
1. A person who takes a risk to produce goods and services in search of profit –
a. entrepreneur
b. magistrate
c. profiteer
d. baliff
2. What kind of business is BEST described by these statements?
I am the only owner of my business. 
I take all the risks of doing business. 
I keep all the profits. 
a. proprietorship c. partnership
b. corporation d. cooperative
3. An entrepreneur - 
a. enforces government regulations c. sets the interest rates at banks
b. takes the risk to earn profit d. manages financial investments
4. In a corporation, owners share profit, but liability is limited to - 
a. investment c. theft
b. distribution d. production
5. A form of business organization that is authorized to act as a legal entity regardless of the number
of owners. 
a. corporation  c. partnership
b. proprietorship d. distributor
6. What is a disadvantage of partnerships?
a. ease of formation c. limited liability
b. owners share responsibilities d. possibility of personality conflict
7. What is the advantage of corporations?
a. minimal government regulation c. short life span
b. limited liability d. has one owner
8. The Dow Jones industrial average swept past 12,000 for the first time. Investors are increasingly
optimistic about corporate earnings and the economy. 
This achievement MOST likely involved which type of business organization?
a. proprietorship c. corporation
b. partnership d. conglomerate
9. In which type of organization does one person take all the risks?
a. corporation  c. monopoly 
b. partnership d. proprietorship
10. Floral Shops, Bookstores, Farms are examples of what type business
a. Sole Proprietorship c. Franchise
b. Corporation d. Multinational Corporation
11. Easy to start, Owner is his/her own boss, Owner keeps all the profits - These are advantages of
what type of business
a. Franchise c. Partnership
b. Corporation d. Sole Proprietorship
12. Which ownership type has unlimited liability (owner has full responsibility for company's debt
and can lose entire investment as well  as personal assets).
a. Partnership c. Corporation
b. Franchise d. Sole Proprietorship
13. What type of business consists of two or more people?
a. Sole Proprietorship c. Corporation
b. Partnership d. Franchise
14. Which are the disadvantages of a partnership?
a. Partnership must be reorganized if one partner quits
b. Partners share unlimited liability
c. Partners may not get along
 d. All of these are correct
15. Law firms, medical practices, and auto body repair shops are examples of what type of ownership
a. sole proprietorship c. franchise
b. partnership d. corporation

16. What type of business structure is owned by many people?

a. corporation c. sole proprietorship
b. partnership d. company
17. Corporations do NOT continue when stockholders sell stock.
a. True b. False
18. Nike, IBM, and Google are examples of
a. partnership c. corporation
b. franchise d. partnership
19. Business owned by one person
a. partnership c. sole proprietorship
b. franchise d. corporation
20. Which is NOT a basic type of business ownership?
a. proprietorship c. corporation
b. partnership d. retail
21. Who plays an important role in all three business organizations?
a. Governors c. Entrepreneurs
b. Presidents d. Magistrates
22. A form of business organization with one owner who takes all the risks and all the profit is called
-
a. partnership c. corporation
b. proprietorship d. governorship
23. A form of business organization with two or more owners who share the risks and the profits - 
a. proprietorship c. wholesale
b. corporation d. partnership
24. Owned by many people - stockholders, but treated by the law as one person
a. Sole Proprietorship c. Partnership
b. Franchise d. Corporation
25. What are business ethics?
a. The moral principles that represent a person or group
b. How companies conduct themselves in terms of their practices and policies as they relate to
doing right by stakeholders and shareholders
c. An ethical concept that implies that companies have a duty to society and the environment
d. None of the answers are correct.
26. What is social responsibility?
a. The moral principles that represent a person or group
b. How companies conduct themselves in terms of their practices and policies
c. An ethical concept that implies that companies have a duty to the society and environment
d. None of the answers are correct.
27. Ethics and social responsibility mean the same thing.
a. True b. False
28. Nearly all business decisions may be judged as right or wrong, ethical or unethical.
a. True b. False
29. The most basic ethical concerns have been formalized through laws and regulations that
encourage conformity to society's values and norms.
a. True b. False
30. All a business has to do to maintain ethical conduct is to follow the law.
a. True b. False
31. Only corporations have to worry about ethics scandals and social responsibility issues.
a. True b. False
32. The principles and standards that determine acceptable conduct in business are referred to as
a. norms d. laws
b. strategies e. rule
c. ethics
33. Social ______ relates to a business's impact on society.
a. responsibility d. law
b. strategy e. rule
c. ethics
34. What is considered ethical may differ depending on the ___ in which a business operates.
a. city c. trade bloc
b. culture d. hemisphere
 e. industry
35. Which of the following statements about business ethics is false?
a. It concerns the impact of a business's activities on society.
b. It refers to principles and standards that define acceptable behavior in business organizations.
c. It relates to an individual's values and moral standards and the resulting business decisions he
or she makes.
d. What is ethical is determined by the public, government regulators, interest groups,
competitors, and each individual's personal moral values.
e. Studying it can help you recognize ethical issues and understand how others make unethical
decisions.
36. Studying business ethics will not necessarily
a. help you recognize ethical issues.
b. help you understand the importance of ethical decisions.
c. inform you about the impact of the work group on ethical decisions.
d. describe the ethical decision-making process.
e. tell you what you ought to do.
37. One of the most difficult things for a business to restore after an ethics scandal is
a. Regulations d. Profits
b. Jobs e. Morale
c. Trust
38. Which of the following have not been cited in your text as incidents of unethical business activity
recently?
a. Unfair competitive practices in the computer industry
b. Deceptive advertising of food and diet products
c. Accounting fraud
d. Stealing via the Internet
e. Corporate charitable giving
39. Which of the following statements is false?
a. Ethical issues are limited to for-profit organizations
b. Business ethics goes beyond legal issues.
c. Ethical conduct builds trust among individuals and in business relationships.
d. Ethical conflicts may evolve into legal disputes.
e. Regardless of what an individual feels about a particular action, if society judges it to be
unethical, that judgment affects the organization's ability to achieve its objectives.
40. An ethical issue is an identifiable problem, situation, or opportunity that requires a person or
organization to choose from among several actions that may be evaluated as ethical or unethical.
a. True b. False
41. The best way to judge the ethics of a decision is to look at it from a manager's or employee's point
of view.
a. True b. False
42. Theft of time is the leading area of misconduct observed in the workplace.
a. True b. False
43. Conflicts of interest are payments, gifts, or special favors intended to influence the outcome of a
decision.
a. True b. False
44. Ethics is related to the culture in which a business operates.
a. True b. False
45. Workplace bullying is an increasing problem.
a. True b. False
46. It is almost always easy to recognize specific ethical issues.
a. True b. False
47. If a manager chooses to act so that she benefits financially or otherwise at the expense of her
firm, then she
a. is bullying d. is cheating
b. is engaging in bribery e. has broken the law.
c. has a conflict of interest
48. Managers use the ______ of their position to influence employees' decisions and actions.
a. authority d. responsibility
b. standards e. acceptance
c. scope
49. involves taking someone else's work and presenting it as your own.
a. Conflict of interest d. Bribery
b. Bullying e. Plagiarism
c. Manipulation
50. That
a. fairness
businesspeople
and honesty
are expected not to harm customers, d.
clients,
business
and competitors
relationshipsknowingly
through
b. communications
deception, misrepresentation, coercion, or discrimination
e. consumerism.
is part of
c. conflict of interest
51. If Sony was investigated for allegedly raising prices of its PlayStation excessively during the
Christmas buying season and thereby manipulating the supply of games available at that time,
this would be an ethical issue concerned primarily with
a. conflict of interest d. cost control
b. communications e. game rules
c. fairness and honesty
52. Making claims about dietary supplements or the health benefits of certain unproven ingredients is
an issue related to
a. conflict of interest d. business relationships
b. communications e. financing
c. product design
53. The warning on cigarette packages about the health implications of smoking is an example of
which of the following ethical issues?
a. Conflict of interest d. Relationships within a business
b. Fairness and honesty e. Environmental issues
c. Communications
54. The following behavior is an example of ethical consideration within business relationships:
a. keeping company secrets d. obeying environmental laws
b. communicating with customers e. donating to local charities
c. whistleblowing
55. If a manager pressures a subordinate to engage in activities that he or she may otherwise view as
unethical, such as engaging in accounting fraud or stealing a competitor's secrets, there exists an
ethical issue related to
a. Plagiarism d. fairness and honesty
b. business relationships e. conflicts of interest
c. communications
56. If an employee learned of a significant cost-saving idea from a coworker and then informed
management of the idea without revealing its true source, then the employee would be involved
in
a. keeping a secret d. bullying
b. career advancement e. bribery
c. plagiarism
57. Establishing and enforcing ethical standards and policies within business can help reduce
unethical behavior by prescribing which activities are acceptable and which are not and by
removing the opportunity to act unethically.
a. True b. False
58. Without a code of ethics or formal policy on ethics, employees are likely to base their decisions
on how their peers and superiors behave.
a. True
b. False
59. Codes of ethics foster ethical behavior because they expand the opportunity to behave
unethically.
a. True b. False
60. Ethical decisions in an organization are influenced by three key factors.
a. True b. False
61. Codes of ethics are formalized rules and standards that describe what the company expects of its
employees.
a. True b. False
62. A large number of ____ cases result in retaliation against the employee, even though the
government has tried to take steps to protect workers and to encourage reporting of misconduct.
a. Executive d. petty theft
b. white collar crime e. federal
c. whistleblower
63. ____ is the act of an employee exposing an employer's wrongdoing to outsiders.
a. Fraud d. Bullying
b. Whistleblowing e. A criminal lawsuit
c. Plagiarism
64. Codes of ethics foster ethical behavior by
a. expanding the opportunity to behave unethically by providing rewards for following the
rules.
b. limiting the opportunity to behave unethically by providing punishments for violations of the
rules and standards.
 c. limiting the opportunity to behave unethically by providing rewards for violations of the rules
and standards.
d. expanding the opportunity to behave ethically by providing punishments for following the
rules.
e. encouraging employees to bend the rules.
65. Unethical behavior in business can be reduced if management does all of the following except
a. establishes clear policies on unethical behavior.
b. limits opportunities for unethical behavior.
c. establishes formal rules and procedures.
d. punishes unethical behavior firmly.
e. depends totally on employees' personal ethics.

Prepared by: Sir FELGER GEMENTIZA TILOS

Subject Teacher

__________________________________________________
PARENT’S/ GUARDIAN’S SIGNITURE OVER PRINTED NAME