In the questions given below, a part of the sentence is given in bold. Below each sentence, some phrases are given which can substitute the bold part of the sentence. Identify the phrase which can correctly substitute the bold part of the sentence. If the sentence is correct as it is, the answer should be ‘no improvement is required’. The government's new policies have undermined investor confidence, leading to a surge in the stock market.

Explanation: The word "undermined" means to weaken or diminish, which contradicts the idea of a "surge in the stock market." The correct word should convey strengthening or supporting investor confidence. "Bolstered" means to strengthen or reinforce, making it the most appropriate replacement. Steadied – Means to make stable but does not imply growth. Sabotaged – Means to deliberately damage or weaken, which is incorrect in this context. No improvement is required – Incorrect, as "undermined" does not logically fit.