Opportunity cost is the cost of something in terms of an opportunity forgone and the benefits that
could be received from that opportunity, or the most valuable forgone alternative.
How does this apply to the issue of Guns and Butter? Well easy. Just like as individuals we have expenses so does the
government; and just like we choose to invest money on things we find most important, So two options arise, either the idea
of debt or taking money from other departments.
But Obviously, the United
States isn’t the only country that has chosen power over its the welfare of its citizens. North Korea
puts 16 percent of its output to the military. The opporutniyt cost of this decision
is reduced output of food. A source tells that with all the defense expenses
North Korea can now only feed fewer than
100,000 people out of the 6.1 that reside in the Country.
Guns and Butter swifts the production possibilities curve (PPC) or the “transformation
curve” is a graph that depicts the trade-off between any two items produced (named after John Forbes Nash, who proposed it) is a kind of solution concept of a game involving two or more players, where no player has anything
to gain by changing only his or her own strategy unilaterally. If each player has chosen a strategy and no player can benefit
by changing his or her strategy while the other players keep theirs unchanged, then the current set of strategy choices and
the corresponding payoffs constitute a Nash equilibrium.
Every nation has ongoing issues about Guns vs. Butter.
“There is an increasing realization that the government pie can't keep growing at past rates, and if you
give more to defense, you must give less to everything else," he said. "What is going on now is just a precursor of more difficult
decisions to come." Congressional Economist Robert W. Hartman
Needless to say, both sides have their advantages and disadvantages.
Needless
to say, so will you “'Stand with
President Bush on increased defense spending that better prepares and protects our military?”
