Answer:
Dialogue should be:
- in quotation marks
- a conversation between characters
- when the speaker changes, the author should start a new line
Depending on the tone an author is trying create, the dialogue could be awkward or unrealistic. Therefore, dialogue does not have to be "natural and resemble real-life conversation".
If you are writing in third person, there would be a narrator. However, dialogue can be used when writing in third person at any time. The author may choose to include dialogue whenever they feel it is right. Also, too much narration may make the prose feel repetitive. Readers can learn a lot about characters based on how they interact with others. We can only learn about these interactions if there is dialogue.
In conclusion, dialogue is an element that can enhance writing, and it does not have to flow a certain way or replace narration.
