Why do economists say you should distinguish between the relative and observable price?

Economists emphasize distinguishing between relative and observable prices because relative prices reflect the value of goods in comparison to one another, influencing consumer choices and resource allocation. Observable prices, on the other hand, are the actual market prices at which goods are sold. Understanding relative prices helps in assessing the opportunity cost of decisions, while observable prices provide concrete data for market analysis. This distinction is crucial for effective economic decision-making and policy formulation.