Question
The Al Shorayai Company produces furniture and is interested in purchasing a new plant that automates the production process. A sophisticated plant is expensive and
The Al Shorayai Company produces furniture and is interested in purchasing a new plant that automates the production process. A sophisticated plant is expensive and requires financial support. They are looking at Islamic finance and have chosen to finance the new plant by dividing the ownership of the machine into equal ownership parts as certificates and selling those parts to prospective investors.
Answers to questions should be related to this case.
a. What Islamic financial instruments are they considering and what is a similar product under conventional finance?
b. Discuss any two variations of this product that will be suitable for this financing.
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