Financial Contract_The Rules

Murabaha is selling a commodity as per the purchasing price with a

defined and agreed profit markup

• True

• False

BBA is a sale contract in which the payment of the price is deferred

and payable at a particular time in the future.

• True

• False

Tawarruq refers to the process of purchasing a commodity for a

deferred price through Musawama (Bargaining) or Murabaha (Markup),

• True

• False

Bai-Al Salam is the purchaser of a commodity for deferred delivery in exchange for immediate payment

• True

• False

Istisna is a contract of sale of specified items to be manufactured or constructed with an obligation on the part of the seller to deliver them to the purchaser upon completion.

• False

• True

Mudaraba is a partnership between two or more parties whereby each partner contributes a specific amount of money in a manner that gives each one a right to deal in the assets of the partnership.

• False

• True

Answer explanation

Mudaraba is a form of partnership in profit whereby one party provides capital (rab-al-maal) and another, management skill or labour (mudarib).

Musharaka (sharikatul al-inan) is a form of partnership in profit whereby one party provides capital (rab-al-maal) and another, management skill or labour (mudarib).

• False

• True

Answer explanation

Musharaka (sharikatul al-inan) is a partnership between two or more parties whereby each partner contributes a specific amount of money in a manner that gives each one a right to deal in the assets of the partnership.

The term Ijarah means leasing of property pursuant to a contract under which a specified permissible benefit in the form of a usufruct is obtained for a specified period in return for a specified permissible consideration

• False

• True

The picture is the structure of the contract

• Ijarah

• Mudaraba

• Salam

• Musharaka

Bay’ al-Sarf is the exchange of one monetary form for another in the same or different type or category, i.e., gold for gold coins, silver for silver, gold for silver, silver for gold, etc., whether it is in the form of jewellery or mintage.

• True

• False