In a thin market
A) only high-quality goods are sold.
B) some high-quality goods are sold but fewer than would be sold in a market with perfect information.
C) some low-quality goods are sold but fewer than would be sold in a market with perfect information.
D) no high-quality goods are sold.

Question

Quizplus · Accepted Answer

In a thin market, there is limited information available to buyers and sellers. Therefore, while some high-quality goods may still be sold, there will be fewer transactions than in a market with perfect information. However, it is also possible that some low-quality goods may still be sold, albeit fewer than in a market with perfect information. Option A and D are incorrect as they make absolute statements that do not necessarily hold true in a thin market.

In a Thin Market