[225] Guns Vs. Butter

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 defence and civilian goods. The "guns or butter" model is used generally as a simplification of national spending as a part of GDP. This may be seen as an analogy for choices between defence and civilian spending in more complex economies. The nation will have to decide which balance of guns versus butter best fulfils its needs, with its choice being partly influenced by the military spending and military stance of potential opponents.