All of the following effects of a financial crisis are shared by emerging markets and industrialized countries except that emerging countries also experience:
A)a liquidity crisis.
B)the bursting of an asset bubble.
C)a sharp depreciation of their real exchange rate.
D)the loss of market liquidity.

Question

Quizplus · Accepted Answer

Emerging markets often experience a sharp depreciation of their real exchange rate during a financial crisis, which is less common in industrialized countries due to their more stable currencies and stronger economic fundamentals.

All of the Following Effects of a Financial Crisis Are