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financial management

What happens when an emerging market suffers a decline . What do foreign investors do?

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When an emerging market faces a decline, most foreign investors start pulling out their investment. As a result, the markets further decline, which has a spiraling effect, and the country's credit rating starts to fall, and the net foreign investment in the country starts becoming negative, i.e., there is more outflow of an investment than the inflow of investment.

answered by: Dabberli
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