Please no written by hand solutions Please answer all questions. Topic 5: Consumer Surplus, Producer Surplus, and Market Efficiency 1. Explain the relationship among the willingness to pay (reservation price) of buyers (consumers), consumer surplus (CS), and the demand curve. 2. Explain the relationship among the costs to the sellers, producer surplus (PS) and, the supply curve. 3. Explain how to compute CS, PS, and total surplus (TS) in a diagram with demand and supply curves. Also explain how a change in price (price increase or decrease) causes changes to CS and PS in the diagram. 4. Explain market efficiency using the concepts of CS and PS. Is "market efficiency" or "efficient allocation of resources" the only policy goal of policymakers? What is your opinion about "efficiency" and "equality" in society?
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Please answer all questions.
Topic 5:
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