By editing normals using the edit normals modifier you are able to have complete control over how your object interacts with reflecting light. By default though 3Ds Max does follow real-world physics for its light reflection.
On the cylinder above when I have any edge that is 90 degrees like that I will add a chamfer or bevel on the edge to make the normal bake better for my objects. Also having a good UV laid out will help you bake as well!
If you have any specific questions feel free to ask!