FINANCE CALCULATION QUESTION
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Get it written →Assignment based on Ijarah Objective: This assignment aims to apply the principles of Islamic finance lease (Ijara wa Iqtina) to calculate the total lease rentals and monthly lease payments for a given scenario. Scenario: In the Saudi Arabian context, where Al Rajhi Bank provides leasing solutions to its retail and business customers: A client of Al Rajhi Bank in Saudi Arabia has applied for an Ijara arrangement to obtain specialized equipment for its Cloth business. Assuming the total expenses borne by the bank for acquiring, delivering, and installing the equipment at the client’s premises amount to SAR 50,000. The agreed lease duration is 6 years, with a profit rate of 8% per annum. Assignment Tasks: 1. Explain the concept of Ijarah and discuss why it is important in Islamic banking. 2. Calculate the total lease rentals 3. Calculate the monthly lease payment required from the client.
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