1. (20 points) Lilliput is an endowment economy and small on world markets. It is endowed with Qc units of clothing and Q1: units of food. Everyone in Lilliput has identical tastes and endowments of food and clothing. Briey explain your answers. a. Use an indifference curve and budget line to show Lilliput freely trading such that it is a food exporter. (Do not show autarky. I am not asking for it, and it will clutter up the diagram.) On your diagram indicate the endowment, consumption, exports, imports, and welfare. How do you interpret the slope of the budget line? Briey explain your diagram. b. Lilliput has a bumper crop of food such that its endowment of food increases by 10%. On your diagram from part a, draw the new endowment, budget line, level of welfare, consumption, exports, and imports. How do you interpret the slope of the new budget line? Has the volume of trade risen or fallen? Briey explain the changes in the diagram