This is the full question

Consider a simplied version of the Ricardian model with a continuum of goods developed in class. In particular, suppose that each good 2 6 [0,1] is ordered so that: A(z)2:11?=(%17f Where (1* (z) is the unit labour requiredment in foreign for good 2, a(z) is the unit labour requirement for 2 at home, while T and T* are parameters governing the level of home and foreign's technology, respectively, and B is a parameter governing the dispersion of productivity differences across coutries.1 Suppose further that preferences are Cobb-Douglas, with equal income shares for every good, i.e. [1(2) = W = W = 1.2 Here, 19(2) denotes the world price of each good 2, D(z) and D\" (2) denote the total demand fromwhdme and foreign for good 2, respectively, n) is home wage rate, w*is foreign wage rate, and L and L* are the size of the labour force in both home and foreign, respectively. All markets are perfectly competitive, and involve constant returns to scale using only labour according to the constant unitlabour requirements described by the A(2) function, above. a) Let w E %. What condition determines whether a given good 2 is produced at home? What condition determines whether a good is produced in the foreign country? What condition must hold for a consumer to be exactly indifferent between buying a good from home or foreign? b) Suppose T = 1, T* = 5, and 0 = 2, and w = 2. Solve for a good, 3, for which consumers are exactly indifferent between buying at home of at foreign. c) Draw a picture illustrating for the parameters described above which goods are produced at home, and which are produced in foreign. (1) Let 9(3) denote the fraction of goods purchased from home, given the marginal good 2'. Given the equal shares asumption described above, what form does 6(2') take? e) In equilibrium, total income of home workers must equal total expenditures on home goods. Write down this equilibrium condition in terms of 2', L, L*,and w