If trading of municipal bonds is infrequent, then secondary market is considered as

A. thin markets

B. thick markets

C. higher underwriting

D. lower underwriting

Answer: Option A

Solution(By Examveda Team)

If trading of municipal bonds is infrequent, then secondary market is considered as thin markets. A thin market is a market with few buying or selling offers. It is also known as a narrow market. The signature characteristic of a thin market is traders' price impact. When the number of buying or selling offers is small, investors' trading positions are large relative to market size.