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5. (22 points) Suppose it is costly to transport exports. Let this cost be equal to some number T per unit. We are going to

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5. (22 points) Suppose it is costly to transport exports. Let this cost be equal to some number T per unit. We are going to investigate some features of how the presence of T impacts the monopolistic competition model with trade. Assume all firms are the same in each country, and that each country is the same size. The problem is written to help guide you to the solution in a series of (hopefully) not too demanding steps. (Most of these steps I sort of do for you.) a. Let Phh be the price a home firm charges in the home country, Pif be the price a home firm charges in the foreign country, Pa be the price a foreign firm charges in the home country, and P# be the price a foreign firm charges in the foreign country. b. Also adopt notation where Xin is the quantity of beer a home country sells at home, with other Xs defined the same way

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