Compare and contrast the two contracts in the following Case

A grocery store owner wants to add a cold dink corner to his existing business where he will be selling cold drinks of a famous brand like ‚Coca Cola or Pepsi‛ . To set up this stall he needs a deep freezer or chiller as without it he will not be able to sell which will cost him 1000Bd , getting all the necessary details and successful completion of required verifications, Islamic finance program approves his application and provide two contract diminishing Musharaka agreement and Murabaha Agreement both for 2 years.

A. The diminishing Musharaka will be on the following terms and conditions.

i.Contribution of Islamic Microfinance program will be 500Bd

ii.Profit Sharing ratio is 40:60.

iii. the rental for the deepfreezer is 30 Bd /month

B. The Murabaha will be with a profit ratio is 5%

Output of the project :

Calculate the returns through Murabaha contract

( islamic banking and finance)

Answer rating: 100% (QA)

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