In a Thin Market

question 229

Multiple Choice

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.

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Definitions:

Outstanding Stock

The number of shares that have been issued by a company and are held by investors, including both public shareholders and company insiders or officers.

Common Stock

A form of corporate equity ownership, a type of security representing a claim on part of the company's assets and earnings.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, often with dividend payment preferences.

Stock Dividend

A dividend payment made to shareholders in the form of additional shares of stock rather than cash.