Economic System

What is Fiat money?

• Currency backed by gold or silver

• A form of digital currency like Bitcoin

• Government-issued money not backed by a physical commodity

• A type of Islamic bond

What is Asset-Backed Financing?

• A financing secured by tangible assets rather than relying on interest-based credit

• A method of financing based purely on speculation

• A financial system where money is created without backing

• A short-term loan without collateral

What is Wealth Redistribution?

• A process where the government confiscates private assets

• The reallocation of wealth through mechanisms like taxation and charitable giving

• The practice of accumulating wealth without sharing it

• The transfer of funds between banks for profit

What are Monetary Policies?

• Laws governing physical asset ownership

• Guidelines for international trade agreements

• Investment plans created by financial institutions

• Strategies used by central banks to regulate the economy, money supply, and inflation

What is Endowment?

• Short-term investments for quick financial returns

• Mandatory taxes imposed on businesses

• Charitable donations or funds set aside for long-term social or religious purposes

• Bank loans given to individuals for personal use

Which of the following is strictly prohibited in Islamic finance?

• Risk-sharing

• Interest

• Asset-backed financing

• Ethical trading

What does the Islamic economic system aim to foster?

• Profit-driven investments

• Justice, fairness, and shared prosperity

• Monopoly and wealth concentration

• Speculative financial markets

How does Islamic finance ensure monetary stability?

• By controlling inflation with interest rates

• By issuing fiat money

• Through risk-sharing and asset-backed securities

• By encouraging speculative investments

How does Islamic finance view money?

• As a commodity to generate profit

• As an investment tool

• As a medium of exchange only

• As a speculative asset

Historically, what currency was used in the Islamic economy?

• Dinar and Dirham

• Bitcoin

• Dollar

• Euros