[10 points] Flu season has started. More consumers have entered the soap market because of it. These con- sumers are different from the consumers currently in the market. The new consumers have a lower Marginal Willingness to Pay (MWTP) at every quantity. All the previous consumers and producers remain in the market. Claim: The market price of soap will fall when the new consumers enter because the new consumers have a lower MWTP. Agree7 Disagree or It depends? Explain your reasoning. A diagram is not an explanation. Your explanation needs to be sufficient without a diagram. Solution: Market supply stays the same. Market demand is the sum of individual demands. If we have more consumers, market demand at the same price is higher than before or the quantity demanded at the same price increases and this happens at every price. If the new individuals have a lower MWTP, the increase in demand will be more pronounced at lower prices. This will cause market price to either remain unaffected (if the increase in demand is below current price) or increase