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explain exchange rule of islam and its application to modern currency exchange,discounting of trade bills/letters of credit and concept of currency islam?

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter8: Investing Activities

Section: Chapter Questions

Problem 14QE

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Explain the exchange rules of islam and its applications to modern currency exchange, discounting of trade bills/letters of credit and the concept of currency salam?
Question 1 : Explain the exchange rules of Islam and its applications to modern currency exchange, discounting of trade bills/ letters of credit and the concept of currency Salam? Question 2 : Discuss the concept of money and modern paper currencies from Islamic point of view. Also discuss the concept of Fuloos and Fiat money and difference of opinion among Shariah scholars on it?
Explain the key characteristics of trading in the foreign exchange market, according to the BIS(Bank for International Settlements) surveys
Explain the foreign currency swaps and why are they undertaken? Explain the functional currency and what is a presentation currency.
A) What is the geographical location of the foreign exchange market? B) What are the two main types of trading systems for foreign exchange? C) How are foreign exchange markets connected for trading activities?
(a) Explain the following terms which are used in the foreign exchange market:(i) Value “Tom” and value “Tod”; (ii) Direct quotation and indirect quotation.
Question 4 There are two main functions of foreign exchange market; to convert the currency of one country into the currency of another, and to provide some insurance against foreign exchange risk. a. Define foreign exchange risk and explain the differences between spot exchange rates, forward exchange rates, and currency swap in order to insure against foreign exchange risk.