Islamic Finance: Understanding Zakat and Nisab
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Questions and Answers

What is the meaning of the word 'zakat'?

  • Obligation towards Allah
  • Fasting practice
  • Prayer ritual
  • Charity and purification (correct)

When does zakat become compulsory on one's wealth?

  • After performing Hajj
  • After the death of the owner
  • Immediately upon acquiring wealth
  • After owning the wealth for at least a year (correct)

Who is entitled to receive zakat?

  • Wealthy individuals
  • One's children and parents
  • The poor and needy (correct)
  • Non-Muslims

What is the Nisab in relation to zakat?

<p>The minimum amount of wealth required for zakat to be obligatory (C)</p> Signup and view all the answers

What are some examples of items on which zakat is payable?

<p>Cash, gold, silver, and raw materials for industrial goods (C)</p> Signup and view all the answers

What is the rate of zakat on cash, gold, and silver?

<p>2.5% (D)</p> Signup and view all the answers

What is the purpose of Zakat according to the text?

<p>To ensure the rich do not forget the needs of the less fortunate (C)</p> Signup and view all the answers

What type of charity is Aus Sadqa based on the text?

<p>Voluntary charity based on compassion (D)</p> Signup and view all the answers

According to Hazrat Muhammad, what qualifies as charity?

<p>Meeting someone with a cheerful face (D)</p> Signup and view all the answers

How does Zakat contribute to societal wealth distribution?

<p>By promoting sharing wealth with the needy (C)</p> Signup and view all the answers

In Hazrat Muhammad's words, what should one do if they have nothing to give in charity?

<p>Work with their own hands for personal benefit (D)</p> Signup and view all the answers

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