I: the Twin Deficits Prediction Is the Proposition That a Country

Multiple Choice

I: The twin deficits prediction is the proposition that a country with a large government budget deficit is likely to have a large trade deficit.II: An increase in foreign interest rates will cause changes in a small open economy that are consistent with the twin deficits prediction.

A) I is true; II is not.
B) II is true; I is not.
C) Both I and II are true.
D) Neither I nor II is true.