Why Alvarez tells the story of the Mirabal sisters, it is not the only focus of her novel. Instead she focus also on the time period that surrounds them; thus she names her book In the Time of the Butterflies to suggest a specific epoch and not just a specific family. The novel examines their family, but it also looks into their way of life and the way it has been impacted by the Dominican Republic's leaders (specifically Trujillo's reign). The time of the butterflies is a time of tremendous political upheaval, which affects all members of the family and the nation. This takes her story beyond just the familial tale to one that examines political themes and repercussions.
Well that is completly dependent on the novel or play you are referring to. In some instances, the title could be used to higlight a theme much like Lorraine's Hansberrys A Raisin in the Sun or John Steinbeck's Of Mice and Men. Or a title could be used to highlight a symbol in a novel for instance J.D. Salinger's A Raisin in the Sun.