When equal amounts are withdrawn at the end of each quarter throughout the year, the interest on drawings is charged for how many months?
Answer & explanation
Correct answer: option 4
The correct answer is option 4- 4.5.
When the amount is withdrawn at the end of each quarter.
Ist drawing = 30th June, so months left after it are 9.
Last drawing = 31st March, so months left after it are 0.
Average Period = (No. of months left after 1 drawings + No. of months left after last drawings)/2
= (9+0)/ 2
= 4.5 months