2. (20 points) This question refers to the standard trade model. Parts a and b are to be done on the same diagram. Fredonia is small on world markets. a. Use a production possibility frontier and a community indifference curve to show Fredonia freely trading at world prices such that it exports food and imports clothing. On your diagram, indicate the points of production and consumption, exports and imports, the initial level of welfare and the world relative price of clothing. Briey explain your diagram. b. On your diagram from part a, show what happens when the world price of food falls (even after the fall in price, Fredonia still exports food). Show the new, points of production and consumption, exports and imports, level of welfare, and the world relative price of clothing. Briey explain your diagram