Musharaka with Profits Assume the following:_ A company is importing and selling Mercedes cars. An Islamic bank invests US$8 million for an 80% profit share. An investor invests US$2 million for a 20% profit share. The investor is to be paid a 10% management fee as a percentage of profit after expenses. Assume: Sale proceeds = US$12,400,000 Expenses = US$200,000 Calculate: 1. The total return to the bank: 2. The total return to the investor: please provide an accurate and step by step answer.

Musharaka with Profits Assume the following:_ A company is importing and selling Mercedes cars. An Islamic bank invests US$8 million for an 80% profit share. An investor invests US$2 million for a 20% profit share. The investor is to be paid a 10% management fee as a percentage of profit after expenses. Assume: Sale proceeds = US$12,400,000 Expenses = US$200,000 Calculate: 1. The total return to the bank: 2. The total return to the investor: please provide an accurate and step by step answer.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 9MC

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Question

Musharaka with Profits

Assume the following:_

A company is importing and selling Mercedes cars.

An Islamic bank invests US$8 million for an 80% profit share.

An investor invests US$2 million for a 20% profit share.

The investor is to be paid a 10% management fee as a percentage of profit after expenses.

Assume:

Sale proceeds = US$12,400,000

Expenses = US$200,000

Calculate:

1. The total return to the bank:

2. The total return to the investor:

please provide an accurate and step by step answer.

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