Bobby is a preteen who has an ice cube maker.
Larry is Susan's dad. The three of them are standing around the kitchen table.
Susan: Dad, please fix the ice maker. I am going to have the lemonade stand today and I need lots of ice.
Dad: Our refrigerator makes a dozen cubes a day. It’s enough.
Bobby: Susan, you can buy some of my ice at one cent each cube.
Dad: I don't want you buying Bobby's ice because what will ours do?
Susan: Dad, our ice maker is too slow. I'd rather just buy some from Bobby.
Dad: Then for every one you buy from Bobby, I am going to make you pay me 1 cent.
Susan: That means that I am paying 2 cents for every ice cube total!
Dad: That’s what you get for getting ice from outside our family.
Susan: But Dad! I am selling the lemonade to our neighbors and bringing money into our family. That money makes our household income go up.
Dad: It doesn't matter. I don't like you buying things from other families. Plus, Bobby's dad got his ice maker for less than we bought ours because he works at Sears.
Susan: Why does it matter?
Dad: Because Sears gave him a discount and I didn't get a discount. That means he can produce ice cheaper than I can.
Susan: So then why don't we just let Bobby's family produce all our ice for us since he can do it cheaper.
Dad: The cost is absorbed by Sears and passed on to all the other customers. So its really not cheaper for anyone.
Susan: But it’s cheaper for us because we are benefiting from the cheaper ice!
Dad: It’s still not right.
Bobby: You guys are a crazy family. I am just trying to help you sell more of your product at a cheaper price.
read more about the true impact of free trade on our economy
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