Questions 2, 3, and 4 ask you to consider the situation described in the article published in Monday, March 2, 2020 issue ofThe Wall Street Journaland titled "Meat Stockpiles Surge as Coronavirus Epidemic Curbs Exports". You do not have to read the story to understand the setup of these questions.

• In 2019, U.S. meatpackers had been exporting large amounts of meat (chicken, pork, and beef) to China.
• However, the coronavirus (Covid-19) outbreak in January and February 2020 has significantly reduced demand for U.S. meat exports.
• For this analysis, assume the meatpacking industry isperfectly competitive, demand is downward sloping, supply is upward sloping, and production technology results in traditional U-shapedATC andAVCcurves.
• Finally, for questions 2, 3, and 4, market price isalwaysgreater than the minimum of theAVCcurve.

Question 2:

Assume that prior to the outbreak of the coronavirus (Covid-19), the meatpacking industry was in Long Run Equilibrium (LRE).

• Using our side-by-side graph methodology, graphically depict the market equilibriumP0andQ0, the optimal output of an individual firm representative of the other firms in the industry at this LRE (labeled asq0), and the individual firm's profit if any (shaded and clearly labeled).
• Provide a brief narrative explaining the setting and the profitability of an individual firm in an LRE (including why there is a certain level of profit in this setting).
• Reminder: Be sure to label all relevant points and axes.