4.Assume that the product in question is crude oil, an integral component in energy production. Focus your analysis, ceteris paribus, on this product (crude oil). Assume that increasing the value of the ruble was the goal, and the movement in the price of crude oil was the reason for the currency appreciation.Assume the production of crude oil uses equal units of capital and labor. Answer the following questions.

A Given the myriad assumptions above, what would you conclude about elasticity of demand for labor in the production of this product? Explain. 8pts

B Again, given all the assumptions, what would you conclude about the elasticity of demand of the final product? Is there more than one? 8 pts.

C. What are your conclusions about the substitution and output effects of labor? Are there multiple effects for this product? How does it relate to your answers in A and B? 8 pts

D. Any thoughts on the implications of resource pricing in this context. +1 pt