14 Islamic Finance Questions and Answers

Islamic Finance Questions

1. In istisna’a, it is possible to adjust the price with mutual consent in some circumstances.
A False B True

2. In Forward sales, goods will remain at the risk of _______ before delivery
A Buyer B Seller

3. Diminishing Musharakah in financing fixed assets involves two contracts: partnership, and lease.
A False B True

4. When a contract of Musharakah is executed, the conditions of agency are automatically presumed to be in existence in the contract.
A True B False

5. if material is supplied by the purchaser and the manufacturer is required to use his labor only
A This contract is Istisna’a B This contract is Ujrah

6. Salam can take place wher both items of exchange are identical
A True B False

7. In Istisna’a, it is necessary that the price is paid full in advance
A True B False

8. Musharakah cannot be concluded with non-muslim
A False B True

9. Some jurists allow delayed payment of the price in salam up to 3 days
A False B True

10. Istisna’a is _______ as long as the manufacturer does not start work on the subject matter.
A Binding B Non binding

11. When salam contract is cancelled, the buyer will be refunded ______.
A The advanced price with decrease B The full advanced price

12. In Mudarabah, Rabulmal cannot specify different periods to state that profits earned in a specific period will be his and that of another period will be for the Mudarib.
A False B True

13. In Mudarabah, losses are entirely borne by Rabulmal even in the case of misconduct by the Mudarib.
A True B False

14. With diminishing Musharakah in trade, the price of each share units sold by the financier partner is not fixed but rather based on market valuation at the time of the purchase of each unit.
A True B False

Answer Key

1. b 2. b 3. a 4. a
5. b 6. b 7. b 8. a
9. b 10. b 11. b 12. b
13. b 14. a

Leave a Reply