Which of the following is a sign of an emerging market?

The characteristic of heavy reliance on foreign capital is an important indicator of an emerging market. Emerging markets often have developing financial systems, which can struggle to provide sufficient capital domestically. As a result, they frequently seek external investment to fund growth and development. This reliance on foreign capital can manifest in various ways, such as attracting foreign direct investment, portfolio investment, or loans from international financial institutions.

In contrast, well-developed financial systems, sufficient domestic savings, and stable, low inflation rates are typically associated with more mature, developed economies. Developed markets tend to have robust financial institutions, higher levels of domestic savings, and stable economic policies that help maintain low inflation. Therefore, an emerging market's dependency on foreign capital is a key distinguishing feature, highlighting its developmental stage and the challenges it faces in achieving economic stability and growth.