Multiple Choice Questions

Circle the letter next to the most accurate answer.

1. Musharaka is also called:
   1. Silent partnership
   2. Full partnership
   3. Sole proprietorship
   4. Guarantee
2. Profits in a Musharaka are shared:
   1. Always in proportion to the capital contribution
   2. In a pre-agreed ratio
   3. In a 50:50 ratio
   4. Decided annually
3. In a Musharaka, the Islamic bank has a:
   1. Certain rate of return throughout the entire period
   2. Uncertain rate of return throughout the entire period
   3. Certain rate of return for a limited period
   4. Uncertain rate of return for a limited period
4. In a Musharaka, investors' capital is:
   1. Exposed to total loss
   2. Exposed to partial loss
   3. Exposed to no loss
   4. Exposed to loss at the beginning only
5. Which of the following is the most appropriate definition of Musharaka?
   1. Musharaka is a deferred payment sales contract of an item
   2. Musharaka is an advance payment sales contract of an item
   3. Musharaka is a partnership between two or more parties, all contribute capital but only one party can manage the venture
   4. Musharaka is a partnership between two or more parties, all contribute capital and can manage the venture
6. Inan Musharaka is a partnership with:
   1. One partner providing the entire capital
   2. Unlimited liability
   3. Limited liability
   4. Equal capital contribution
7. The Musharaka capital contribution determines:
   1. Profit-sharing ratio based on agreement
   2. Loss-sharing ratio based on outstanding capital
   3. Profit and loss-sharing ratio based on agreement
   4. None of the above
8. Diminishing Musharaka reduces:
   1. Capital loss exposure of entrepreneur
   2. Capital loss exposure of financier
   3. Profit rate of entrepreneur
   4. Profit rate of financier
9. Which of the following is a difference between Musharaka and Mudaraba?
   1. Profit-sharing ratio only
   2. Management role of entrepreneur
   3. Management role of capital provider
   4. Loss-sharing ratio only