How To Find Consumer Surplus?

Find the demand curve or demand equation

Identify the market price paid per unit

Determine the quantity purchased at that price

Find the maximum price consumers are willing to pay for each unit up to that quantity

Calculate the area between the demand curve and the market price line from 0 to the quantity purchased

Use the formula: Consumer Surplus = Total willingness to pay – Total amount actually paid

For a linear demand curve, use: Consumer Surplus = 1/2 × base × height

Base = quantity purchased

Height = maximum willingness to pay at zero quantity – market price

For a demand equation, integrate the demand curve above the price from 0 to quantity

Consumer Surplus = ∫ from 0 to Q of [Demand Price(q) – Market Price] dq

Suggested for You

Trending Today