1. In a two country, two good Ricardian model the size of the labour force and the unit labour requirements are provided in the following table: I Home Foreign I | labour L = 1200 L* = 800 | Apples aLA=3 31A: 5 Bananas 61.3 = 2 \"EB = 1 (Note this is the same as the Ricardian example covered in lecture). (a) With no information about the relative demand for goods what is known about the relative demand for labour, n as a function of %? (Shape of RDL, any specic values along the vertical or horizontal axis). (b) What is the range of % when there is free trade? (This is likely something that was answered in (11)). (c) For an arbitraryf falling' 1n the range from (1)), determine the relative prices of T goods with free trade,P PB . (d) If the Relative Demand for Apples 1s 9: % iii}?! determine the relative demand for Apples as a function of the relative wage 33 (e) Use the information' 1n the preceding parts of the question to express the relative L D 3 Far (f) Graph RDL showing all values along the horizontal and vertical where the slope of the graph changes. In demand for labour as a. function of the relative wage, E' (g) Determine the equilibrium relative wage % when there is free trade