1. What is the primary source of guidance for Islamic finance?
a. The Quran
b. The Bible
c. The Bhagavad Gita
d. The Torah
Answer: a. The Quran
2. What is the Islamic term for interest?
a. Halal
b. Riba
c. Zakat
d. Sadaqah
Answer: b. Riba
3. In Islamic finance, what does the term “Shariah-compliant” mean?
a. It conforms to Islamic law
b. It follows secular regulations
c. It’s based on Buddhist principles
d. It’s approved by the World Bank
Answer: a. It conforms to Islamic law
4. What is the concept of “Mudarabah” in Islamic finance?
a. Profit sharing
b. Interest payments
c. Stock dividends
d. Asset leasing
Answer: a. Profit sharing
5. What is “Zakat” in Islamic finance?
a. A form of taxation
b. A loan agreement
c. A type of investment
d. A charitable obligation
Answer: d. A charitable obligation
6. What is the Islamic term for the practice of donating a certain percentage of wealth to charity?
a. Zakat
b. Ribah
c. Musharakah
d. Ijarah
Answer: a. Zakat
7. Which of the following is considered permissible in Islamic finance?
a. Speculative trading
b. Paying interest on loans
c. Gambling
d. Investing in alcohol companies
Answer: d. Investing in alcohol companies
8. What does “Ijarah” refer to in Islamic finance?
a. Leasing
b. Interest
c. Debt financing
d. Equity investment
Answer: a. Leasing
9. What is the Islamic principle of “Gharar”?
a. Uncertainty or ambiguity
b. Fair dealing
c. Charity
d. Usury
Answer: a. Uncertainty or ambiguity
10. Which type of financial transaction is prohibited in Islamic finance due to the concept of “Gharar”?
a. Speculative trading
b. Profit sharing
c. Debt financing
d. Asset leasing
Answer: a. Speculative trading
11. What is the Islamic term for a contract that involves joint venture partnerships?
a. Musharakah
b. Murabaha
c. Takaful
d. Istisna
Answer: a. Musharakah
12. Which principle of Islamic finance emphasizes risk-sharing between parties?
a. Mudarabah
b. Murabaha
c. Tawarruq
d. Takaful
Answer: a. Mudarabah
13. What does “Murabaha” entail in Islamic finance?
a. Cost-plus financing
b. Profit sharing
c. Asset leasing
d. Interest payments
Answer: a. Cost-plus financing
14. What is “Sukuk” in Islamic finance?
a. Islamic bonds
b. Interest-based loans
c. Mutual funds
d. Currency trading
Answer: a. Islamic bonds
15. What is the Islamic term for a charitable endowment?
a. Waqf
b. Qard Hasan
c. Hawala
d. Mudarabah
Answer: a. Waqf
16. In Islamic finance, what does “Qard Hasan” refer to?
a. An interest-free loan
b. Profit sharing
c. Mortgage financing
d. Venture capital investment
Answer: a. An interest-free loan
17. Which of the following is a mode of Islamic finance that involves commodity trading?
a. Murabaha
b. Ijarah
c. Istisna
d. Tawarruq
Answer: d. Tawarruq
18. What is the Islamic term for Islamic insurance?
a. Takaful
b. Murabaha
c. Musharakah
d. Riba
Answer: a. Takaful