1. Prompt:Read“YOU’RE THE ECONOMIST: Recession Takes a Bite Out of Gator Profits” in Chapter 8. Assuming gator farming is perfectly competitive, explain the long-run competitive equilibrium condition for the typical gator farmer and the industry as a whole.

2. Read “YOU’RE THE ECONOMIST: The Standard Oil Monopoly” in Chapter 9. If Standard Oil was a natural monopoly, what would happen to the average cost of producing gasoline after the company was split up? Explain using an LRAC curve.

o Requirements: 250 words minimum for each question

Answer  preview

Companies offering similar products in the same industry face intense competition. Notably, businesses try to charge more for the products; however, most experience a backlash from the clients since they opt to get services from another seller at a lower cost (Tucker, 2019). These competitive conditions are prevalent in agricultural practice, whereby farmers producing the same farm products face fierce competition. In most instances, these farmers opt to try another farming practice to reduce extreme competitive conditions. As illustrated in chapter eight, the case study reveals that cow farmers had to switch their agricultural practice to a more profiting venture of keeping alligators as farm animals (Tucker, 2019). Gator farming became the fastest growing business in Florida, which opened up new opportunities in diverse industries.

550 words