Perfect Competition, Imperfectly Competitive Markets and Monopoly

What is consumer surplus?

The difference between the price the consumer is willing and able to pay and the price they actually pay.

What does the law of diminishing marginal utility say?

Consumer surplus generally declines with extra units consumed.

Why does the consumer surplus generally decline with each extra unit consumed?

As the extra unit generates less utility than the one already consumed.

Why do inelastic demand curves give a larger consumer surplus?

As consumers are willing to pay a much higher price to consume the good.

How does consumer surplus increase?

From a rightward shift of demand.