A Muslim merchant purchases a commodity for $10{,}000$ Naira cash. He intends to sell it on a murabaha contract with a $20\%$ markup, payable in two equal annual installments. Calculate the amount of each installment, and state whether the total profit complies with the prohibition of riba.

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Accepted Answer

6,000 Naira per installment; the profit is permissible (not riba)

Neco 2020 Islamic Religious Studies Question 25

A Muslim merchant purchases a commodity for \(10{,}000\) Naira cash. He intends to sell it on a murabaha contract with a \(20\%\) markup, payable in two equal annual installments. Calculate the amount of each installment, and state whether the total profit complies with the prohibition of riba.

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Neco 2020 Islamic Religious Studies Question 25

A Muslim merchant purchases a commodity for \(10{,}000\) Naira cash. He intends to sell it on a murabaha contract with a \(20\%\) markup, payable in two equal annual installments. Calculate the amount of each installment, and state whether the total profit complies with the prohibition of riba.

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About This Question

Master the Exam!

A Muslim merchant purchases a commodity for \(10{,}000\) Naira cash. He intends to sell it on a murabaha contract with a \(20\%\) markup, payable in two equal annual installments. Calculate the amount of each installment, and state whether the total profit complies with the prohibition of riba.