With smaller hook and A, ch 16.
Ribbing: Row 1 Sc in 2nd ch from hook and in each remaining ch across - 15 sc. Ch 1, turn. Row 2 Sc in back loop only of each sc across. Ch 1, turn. Repeat Row 2 until ribbing measures 20 inches, slightly stretched. Change to larger hook. Rotate ribbing and work 90 sc evenly spaced across one long edge of ribbing. Ch 3, turn. Next row Skip first st, dc in each st across - 90 dc, counting turning ch as first dc. Ch 3, turn. Work even in dc until piece measures 27 inches from lower edge of ribbing. Fasten off.
Work same as for back until piece measure 6½" above ribbing, ending with a WS row.
Next row Work first 13 dc (counting turning ch) with A, changing to B at end of last st, and work center 64 dc with B, attaching another strand of A in last st and working last 13 dc with A. Working first and last 13 dc with A, work center 64 sts as follows: work 1 more row B, 2 rows C, (2 rows B, 2 rows C) twice more. Next row Continuing 13 A sts at ends, on flag sts, work 36 B sts, 41 A sts. Keeping all A sts as established, work 1 more row B, then (2 rows C, 2 rows B) 3 times. This completes flag. Continue with A only and work until piece measures 25 inches from lower edge of ribbing.
First side Work first 41 dc, turn. Dec 3 sts neck edge every row 4 times. (To dec at beg of row, slip st across 3 sts, ch 3, skip next dc, dc to end. To dec at end of row, work to last 3 sts, turn.) Fasten off. Skip center 8 sts. Attach A with slip st and work other side to correspond.
Work cuff as for back ribbing until ribbing measures 8½ inches slightly stretched. Change to larger hook. Rotate ribbing and work 50 sc evenly spaced across one long edge of cuff. Work in dc rows and inc 1 st each end of every other row 19 times. (To inc, work 2 dc in 1 st) Work even on 88 dc until sleeve measures 21 inches from lower edge of cuff. Fasten off.
Position stars on blue field of flag as shown, alternating rows of 3 and 4 stars. Sew in place. Sew shoulder seams.
On Ws, using smaller hook and A, start at one shoulder seam to work 84 sc evenly spaced around neck edge for base row. Ch 15, turn to RS. Row 1 Sc in wnd ch from hook and in each remaining ch across, then sc in next sc of base row. Turn. Row 2 Working in back loops only, sc in each sc of ribbing. Ch 1, turn. Row 3 Working in back loops only, sc in each ribbing sc, sc in next sc of base row. Turn. Repeat Rows 2 and 3 around neck edge. Fasten off. Sew ends of ribbing tog. Mark side edges of front and back 11½" down from shoulder seam for armholes. Sew sleeves to armholes between markers. Sew side and sleeve seams.