In the island of Hoola Boola Moola , inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island. the average monthly income had to be calculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9months per year. This would lead to people having an underestimation of their saving since there would be an underestimation of the income and overestimation of their expenditure per month.
this is a passage followed by question .
From the passage i interpret that the
When we're calculating avg monthly income we need to assume that there are 14 months (2 months more than normal) and then we're adding each monthly income value divided by 14 to get avg .
When we're calculating avg monthly expenditure we need to assume that there are 9 months (3 months less than normal) and then we're adding each monthly expenditure value divided by 9 to get avg .
right ?
This would lead to people having an underestimation of their saving since there would be an underestimation of the income and overestimation of their expenditure per month.
this statement I cannot understand?
this is a passage followed by question .
From the passage i interpret that the
When we're calculating avg monthly income we need to assume that there are 14 months (2 months more than normal) and then we're adding each monthly income value divided by 14 to get avg .
When we're calculating avg monthly expenditure we need to assume that there are 9 months (3 months less than normal) and then we're adding each monthly expenditure value divided by 9 to get avg .
right ?
This would lead to people having an underestimation of their saving since there would be an underestimation of the income and overestimation of their expenditure per month.
this statement I cannot understand?