Hi,

At first you need to set coordinate system in both drawings (master and external reference) to World coordinate system (WCS).

In master drawing turn on current layer (I noticed that it is turned off).

Than in your master drawing, use menu Insert -> DWG reference, select external reference, select options in Insert DWG window, select OK and when AutoCAD will ask for the insertion point - type 0,0 and hit Return.
Reference should be in correct place.

Maxim