A capital ________ can promote financial instability in an emerging-market country because it can lead to a lending boom and excessive risk-taking on the part of banks,which helps trigger a ________.

Question

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An inflow of capital can promote financial instability in an emerging-market country because it can lead to a lending boom and excessive risk-taking. This can then create a debt bubble, which may burst and trigger a financial crisis. A currency devaluation is not directly related to an inflow of capital.

A Capital ________ Can Promote Financial Instability in an Emerging-Market