The Following Statements Regarding the AAOIFI Standards on Islamic Bonds

question 55

Multiple Choice

The following statements regarding the AAOIFI Standards on Islamic Bonds are true EXCEPT:

• A) the standards contain the Sharī'ah rulings and requirements on the different types of sukuk as well as the prevailing practices in the secondary markets
• B) the scope of the investment sukuk is clearly specified with the enumeration of the fourteen types of Sukuk structures Table 7.2 of the textbook.
• C) the AAOIFI investment sukuk standards are extended to shares of stock companies, certificates of funds and investment portfolios
• D) the focus of the standards is the Islamic financial institutions or corporate entities offering Islamic financial services such as sukuk

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Definitions:

Sunk Costs

Expenses that have already been incurred and cannot be recovered or refunded.

Capital Investment

Funds invested in a business or enterprise with the intention of furthering its business objectives.

Capital Budgeting

The process of evaluating and selecting long-term investments compatible with the firm's goal of wealth maximization.

NPV

Short for Net Present Value, which is a financial metric used to evaluate the profitability of an investment or project, considering the time value of money.