Which of the Following Is True About the Islamic Banking

question 23

Multiple Choice

Which of the following is true about the Islamic banking method the mudarabah?

• A)A mudarabah contract is similar to a profit-sharing scheme.
• B)Under mudarabah,when an Islamic bank lends money to a business,it charges interest on the loan.
• C)It is the most widely used banking method among the world's Islamic banks,primarily because it is the easiest to implement.
• D)It has been proven that a mudarabah contract discourages both long-term savings and long-term investment.
• E)A mudarabah contract uses a price markup method to make profits.

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Definitions:

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its share price, used by investors to evaluate the return on a dividend-paying stock.

Common Stock Quote

The current price at which a share of common stock is trading on the stock market.

Dividends

Profits paid out by a corporation to its shareholders as distributions.

Payments In Kind

Transactions where the payment is made in goods, services, or other non-cash forms instead of monetary payment.