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If trading of municipal bonds is infrequent, then secondary market is considered as
Answer & Solution
Correct Answer:
Option
A
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.
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