Consumer's Surplus

Consumer's Surplus, a concept developed by Alfred Marshall, measures the extra satisfaction a consumer enjoys because he is often willing to pay MORE for a good than what he actually has to pay in the market. Formally, Consumer's Surplus is the excess of what a consumer WOULD be willing to pay for a given quantity of a good over what he ACTUALLY pays for it at the prevailing market price:

$\text{Consumer's Surplus} = \text{Total amount the consumer is willing to pay} - \text{Total amount actually paid}$ …