State and explain the two fundamental theorems of welfare economics.

The two fundamental theorems of welfare economics are crucial concepts in microeconomic theory that describe the efficiency of competitive markets and the role of government in achieving economic welfare. They are:

### 1. First Fundamental Theorem of Welfare Economics

Statement:
In a perfectly competitive market, the allocation of resources is Pareto efficient. That is, if a market is in equilibrium, where supply equals demand for every good and service, then the resulting distribution of resources will be Pareto optimal. This means that no reallocation can make someone better off without making someone else worse off.

Explanation:
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