The bond market can indeed be "thin," meaning it may not always have a high volume of trades or liquidity for certain bonds. Additionally, it is primarily made up of a network of bond dealers who operate in the over-the-counter (OTC) market, rather than a centralized exchange. This structure facilitates the trading of bonds directly between parties.

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The Bond Market

Question 22

Multiple Choice

The bond market

A) can be quite "thin."
B) primarily consists of a network of bond dealers in the over-the-counter market.
C) consists of many investors on any given day.
D) can be quite "thin" and primarily consists of a network of bond dealers in the over-the-counter market.
E) primarily consists of a network of bond dealers in the over-the-counter market and consists of many investors on any given day.

Correct Answer: