FIN624 Islamic Mode of Financing GDB 1 Solution Spring 2014


Mr. A & Mr. B form a partnership (Shirkat-ul-Aqd) where capital, management, profit, risk and labor are taken at par while Mr. C & Mr. D entered into the same type of partnership where partners settled the terms for capital, management, profit, risk and labor on inequality basis.

Discussion Questions:

Identify the types of “Shirkah” chosen by “Mr. A & Mr. B” and “Mr. C & Mr. D” for their business.

Solution: Mr. A & Mr. B choose Aqd bayn al-Mutasharikayn and Mr. C & Mr. D choose Mudarabat

Which type of “Shirkah” identified in requirement (1) is preferable in your opinion? Explain with logical arguments.

Aqd bayn al-Mutasharikayn is preferable now you have to define it with logical reasons

Write the single most distinguished valid point of partnership under Islamic Shariah.

  Most valid distinguishable point in my sense is that in 1st category the profit and loss is equally divided among partners whereas in 2nd category which is Mudabarat there is inequality.