The sequence of folding a piece of paper and the manner in which the folded paper has been cut is shown in the following figures. How would this paper look when unfolded?

When the paper is unfolded, the pattern of cutting will be similar in the four similar parts.

When the paper is unfolded first, two squares will appear at the bottom of the paper.

When the paper is unfolded again, two squares will appear at the top of the paper and the sector which is cut will form a circle at the centre.

$$\therefore\ $$When the paper is unfolded it appears as shown below

Hence, the correct answer is Option C