Question 23: What is the Islamic perspective on borrowing money?

A) Borrowing money is allowed as long as it doesn’t involve interest (riba)

Question 20: How much is the zakat (charity) that a Muslim must pay on their wealth?

B) 2.5% of their savings or wealth

Question 19: What is “zakat” in Islam?

B) A mandatory form of charity to help the poor and needy

Question 17: What does the term “riba” refer to in Islamic finance?

C) The practice of charging or paying interest on loans

Question 18: Why is riba (interest) prohibited in Islamic finance?

A) Because it helps the rich get richer and exploits the poor

Question 6: Why is it important to save for an emergency fund?

B) To have money for unexpected expenses like car repairs or medical bills

Question 9: What is an example of a long-term financial goal?

B) Saving for college or a house

Question 22: Which of the following is a "halal" (permissible) investment in Islamic finance?

C) A business involved in ethical practices and avoids riba (interest)

Question 5: What is compound interest?

B) Interest earned on the initial principal + what has already been added

Question 24: What does "halal" mean in terms of financial transactions?

A) Financial transactions are ethical, just, and don't involve interest

Question 26: (BONUS) What is the Islamic view on financial risk?

B) Risk is encouraged as long as it is shared fairly +based on mutual trust

Question 12: What is the purpose of insurance?

B) To protect you financially in case of unexpected events

Question 21: Who is eligible to receive zakat?

B) Those in need, including the poor, orphans, and people in debt

What is the purpose of budgeting?

D) To increase your credit score

Question 14: Which of the following is an example of an asset?

B) Your personal savings account balance

Which of the following is an example of a fixed expense?

B) Monthly rent or mortgage payment

Question 13: What does it mean to diversify your investments?

B) spread your money across different types of investments to reduce risk

Question 25: What is the "nisab" in relation to zakat?

A) The amount of wealth a person must have before paying zakat

Question 11: What is "financial independence"?

B) Having enough money to support yourself without relying on others

Question 10: What is the difference between a debit card and a credit card?

B) debit uses money in your account; a credit borrows money you will have

Question 4: What is a credit score used for?

C) To assess your ability to borrow money

Question 16: What is the key principle of Islamic finance?

C) Earning profit through ethical investments and avoiding interest (riba)

Question 15: What is the primary goal of investing?

A) grow wealth over time by putting $ into assets that may increase

Question 7: What is the best way to reduce debt?

B) Pay off high-interest debts first

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Financial Literacy Bedayah Co-op

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Questions 26

Answers

1
Question 23: What is the Islamic perspective on borrowing money?
D) Borrowing money is only allowed for investment in businesses
C) Borrowing money is encouraged for personal gain
B) Borrowing money is always prohibited in Islam
A) Borrowing money is allowed as long as it doesn’t involve interest (riba)
2
Question 20: How much is the zakat (charity) that a Muslim must pay on their wealth?
D) 1% of their monthly earnings
C) 50% of all wealth
B) 2.5% of their savings or wealth
A) 10% of their annual income
3
Question 19: What is “zakat” in Islam?
A) A way to invest in the stock market
D) A loan offered to the government
B) A mandatory form of charity to help the poor and needy
C) A tax on profits for businesses
4
Question 17: What does the term “riba” refer to in Islamic finance?
A) Profit from investments in ethical businesses
D) Donations to charity
C) The practice of charging or paying interest on loans
B) A type of tax on profits
5
Question 18: Why is riba (interest) prohibited in Islamic finance?
A) Because it helps the rich get richer and exploits the poor
D) Because it increases the value of money without effort
C) Because it ensures fairness for both parties in a contract
B) Because it encourages the exchange of goods
6
Question 6: Why is it important to save for an emergency fund?
A) To buy expensive things
B) To have money for unexpected expenses like car repairs or medical bills
D) To pay off credit cards
C) To invest in the stock market
7
Question 9: What is an example of a long-term financial goal?
D) Paying off your credit card bill next month
C) Spending all your money on a shopping spree
B) Saving for college or a house
A) Buying a cup of coffee tomorrow
8
Question 22: Which of the following is a "halal" (permissible) investment in Islamic finance?
A) A company that produces alcohol or gambling products
D) A company that deals with unethical labor practices
C) A business involved in ethical practices and avoids riba (interest)
B) A company that provides interest-based loans
9
Question 5: What is compound interest?
D) Interest that is paid monthly
A) Interest that is added to your account only once
B) Interest earned on the initial principal + what has already been added
C) Interest earned only on the money you deposited
10
Question 3: What does it mean to live "below your means"?
A) Spending all of your income every month
B) Spending more than you earn
D) Saving all your money and never spending it
C) Spending less than you earn
11
Question 24: What does "halal" mean in terms of financial transactions?
D) Financial transactions that involve charging interest
B) Financial transactions that are approved by the government
C) Transactions that maximize profits at any cost
A) Financial transactions are ethical, just, and don't involve interest
12
Question 8: Which of these is an example of a variable expense?
C) Grocery bills
D) Health insurance
A) Car loan payment
B) Rent payment
13
Question 26: (BONUS) What is the Islamic view on financial risk?
B) Risk is encouraged as long as it is shared fairly +based on mutual trust
D) Risk should be taken only in speculative investments
A) Risk should be avoided at all costs
C) Risk should always be minimized by guaranteeing profits
14
Question 12: What is the purpose of insurance?
C) To help you save for retirement
D) To make money through investing
A) To cover the cost of your daily expenses
B) To protect you financially in case of unexpected events
15
Question 21: Who is eligible to receive zakat?
B) Those in need, including the poor, orphans, and people in debt
D) Any adult Muslim
A) Only close family members
C) The government
16
What is the purpose of budgeting?
C) To save for future vacations
B) To keep track of your income and expenses
D) To increase your credit score
A) To spend all the money you earn
17
Question 14: Which of the following is an example of an asset?
B) Your personal savings account balance
A) A student loan
D) An outstanding mortgage payment
C) A credit card balance
18
Which of the following is an example of a fixed expense?
B) Monthly rent or mortgage payment
A) Movie tickets
D) Clothes shopping
C) Grocery shopping
19
Question 13: What does it mean to diversify your investments?
B) spread your money across different types of investments to reduce risk
A) put all your money into one investment
C) To only invest in stocks
D) To keep your money in a savings account
20
Question 25: What is the "nisab" in relation to zakat?
C) The interest rate applied to savings
B) The percentage of income donated to charity each year
A) The amount of wealth a person must have before paying zakat
D) The penalty for not paying zakat
21
Question 11: What is "financial independence"?
C) Never having a budget
A) Relying on loans to survive
D) Asking others for money whenever needed
B) Having enough money to support yourself without relying on others
22
Question 10: What is the difference between a debit card and a credit card?
B) debit uses money in your account; a credit borrows money you will have
D) There is no difference between the two
C) debit is only for online purchases; a credit is for in-person purchases
A) debit uses money you don’t have; credit uses money you do have
23
Question 4: What is a credit score used for?
D) To track your spending on credit cards
B) To measure how much money you spend
A) To determine your age
C) To assess your ability to borrow money
24
Question 16: What is the key principle of Islamic finance?
A) Earning as much profit as possible without any restrictions
C) Earning profit through ethical investments and avoiding interest (riba)
B) Earning profit through interest-based loans
D) Giving all your money away to charity
25
Question 15: What is the primary goal of investing?
C) buy luxury items
A) grow wealth over time by putting $ into assets that may increase
B) make quick money
D) pay off your debts
26
Question 7: What is the best way to reduce debt?
B) Pay off high-interest debts first
A) Ignore the bills and hope they go away
C) Keep borrowing more money
D) Avoid paying bills altogether

Financial Literacy Bedayah Co-op Flashcards | StudBud