A decrease in income will shift the demand curve for an inferior good to the right

Refer to the budget line shown in the diagram above. Given the same money income, reductions in the prices of both products C and D will:

A) shift the budget line outward on the horizontal axis, but leave it anchored at "10" on the vertical axis. B) shift the budget line to the left. C) shift the budget line to the right. D) have no effect on the budget line.

Countries that borrow large amounts of money from foreign lenders prefer to:

A) hold an undervalued currency. B) hold an overvalued currency. C) have a high rate of unemployment. D) have a low rate of inflation. Suppose India borrows $10,000 from the U.S. at the beginning of 2012. The flexible exchange rate is 50 Indian rupees per dollar.