Neco 2018 Islamic Religious Studies Question 37

Practice objective / multiple choice question 37 from the 2018 Neco Islamic Religious Studies examination.

Neco 2018 Islamic Religious Studies Objective / Multiple Choice Medium Difficulty
Question 37 NECO • 2018 • ISLAMIC_RELIGIOUS_STUDIES • objective

A seller agrees to sell a piece of land for \(\text{₦}500,000\) payable in two installments: \(\text{₦}300,000\) now and \(\text{₦}200,000\) after one year with a 10% increase over the original deferred amount. According to Islamic commercial law, does this contract involve riba al‑nasiʿah (interest) and is it permissible? Show the steps of your analysis.

Answer Options

A. Yes, it involves riba al‑nasiʿah, but the contract can be permissible if the parties waive the interest component.
B. No, it does not involve riba al‑nasiʿah because the 10% increase is considered a legitimate profit margin, so the contract is permissible.
Correct Answer C. Yes, it involves riba al‑nasiʿah because the deferred payment is increased by 10%, making the total price higher than the cash price; the contract is therefore impermissible.
D. No, the contract is permissible since the total amount payable equals the cash price after accounting for the time value of money.
Correct Answer
C
Correct Option:
Yes, it involves riba al‑nasiʿah because the deferred payment is increased by 10%, making the total price higher than the cash price; the contract is therefore impermissible.

About This Question

This is Neco 2018 Islamic Religious Studies Question 37. It is one of the objective questions from the 2018 Neco Islamic Religious Studies examination.

Difficulty level: Medium .

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