Question: I cannot see any difference between these two sentences. I assume both express the same but what is the difference? I thought that "used to" is used to describe an action that was happening in the past...but should "live" be considered as an action?

> 
> I used to live in Prague 5 years ago.  
> 
>  I lived in Prague 5 years ago.
> 
> 
>

Answer: 
There is **no difference** between the two. Both mean the same.
Strictly speaking, both are correct, and both mean the same thing, but I think that "I used to live in Prague 5 years ago" is slightly awkward; for a verb like "live", the "5 years ago" makes the "used to" unnecessary.

Without the "5 years ago", or other contextual indication of time, "used to" would definitely be better: "I used to live in Prague", not just "I lived in Prague".