<P> In macroeconomics , the guns versus butter model is an example of a simple production -- possibility frontier . It demonstrates the relationship between a nation 's investment in defense and civilian goods . In this example , a nation has to choose between two options when spending its finite resources . It may buy either guns ( invest in defense / military ) or butter ( invest in production of goods ) , or a combination of both . This may be seen as an analogy for choices between defense and civilian spending in more complex economies . </P>
<P> In macroeconomics , the guns versus butter model is an example of a simple production -- possibility frontier . It demonstrates the relationship between a nation 's investment in defense and civilian goods . In this example , a nation has to choose between two options when spending its finite resources . It may buy either guns ( invest in defense / military ) or butter ( invest in production of goods ) , or a combination of both . This may be seen as an analogy for choices between defense and civilian spending in more complex economies . </P>
what does the economic concept of guns or butter mean
what does the economic concept of guns or butter mean
demonstrates the relationship between a nation 's investment in defense and civilian goods
demonstrates the relationship between a nation 's investment in defense and civilian goods