Operation Bootstrap Was Launched After the Second World War to Attract

question 22

Multiple Choice

Operation Bootstrap was launched after the Second World War to attract U.S. corporations to Puerto Rico. What was the overall outcome of Operation Bootstrap?

• A) Rapid overall growth in the Puerto Rican economy although unemployment remained high and wages stayed low
• B) Reduced unemployment in Puerto Rico and increased wages despite the fact that few new corporations were attracted.
• C) Significantly higher wages for workers but at the cost of significantly increased unemployment
• D) Decreased wages for both Puerto Ricans and U.S. workers as corporations sought bases in other countries

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Definitions:

Breakeven Volume

The number of units that must be sold at a given price to cover all costs, with no profit or loss.

Variable Costs

Costs that change in proportion to the level of output or activity in a business.

Fixed Costs

Rent, salaries, and insurance charges are examples of expenses that are unaffected by changes in production or sales volumes.

EBIT-EPS Analysis

A tool used to study the effect of financing alternatives on a company's earnings per share and taxes.