PIF3013 TUTORIAL CHAPTER 2

What is the essence of Islam based on?

• The Bible and the teachings of Jesus

• The Qur'an and the Traditions of the Prophet Muhammad

• The writings of Confucius

• The Vedas and the teachings of Hinduism

What does Shari'ah provide guidance on?

• Only legal prescriptions

• Only financial transactions

• Belief, moral conduct, and practical rulings

• Only moral conduct

Which of the following is prohibited in Islamic finance?

• Interest (riba)

• Profit sharing

• Risk sharing

• Asset-based financing

What is Takaful?

• A form of gambling

• An arrangement based on mutual assistance

• A type of Islamic loan

• A conventional insurance policy

What is the main principle of Islamic banking?

• High-interest loans

• Mutual risk and profit sharing

• Guaranteed profits for investors

• Speculative trading

Which of the following is a component of the Islamic financial system?

• Conventional banking

• Islamic Capital Market

• Interest-based loans

• Stock market speculation

What does 'Halal' mean in the context of contracts?

• Prohibited

• Permissible

• Invalid

• Uncertain

What is the role of the Islamic Capital Market?

• To provide loans with high interest

• To support gambling activities

• To generate economic growth without conflicting with Islamic principles

• To promote interest-based transactions

Which of the following is NOT a principle of Islamic finance?

• Requirement of tangible assets

• Prohibition of interest

• Prohibition of gambling

• Guaranteed returns on investments

What does 'Gharar' refer to in Islamic finance?

• Fixed interest rates

• Certainty in contracts

• Excessive uncertainty in contracts

• Guaranteed profits