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    Question

      The limit to which a firm or company can withdraw

    from the sanctioned working capital limit is called:
    A Drawing power Correct Answer Incorrect Answer
    B Term loan limit Correct Answer Incorrect Answer
    C Credit limit Correct Answer Incorrect Answer
    D Overdraft Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Drawing Power generally addressed as “DP,” is an important concept for Cash Credit (CC) facility availed by banks and financial institutions. It is the limit to which a firm or company can withdraw from the sanctioned working capital limit.

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