Question

Which of the following is true of goods traded in the commodity market?

A. They have elastic demand.
B. They're raw and unprocessed.
C. They're not fungible.
D. They're normal goods.

Answer 1

The answer is B. They're raw and unprocessed.

The commodity market is known to trade goods in the primary economic sector instead of finished goods. This means that all the products in a commodity market are all considered raw materials for other industries, and need to be further processed to make various end products. There are two types of commodities: soft (agricultural goods) and hard (mined goods).