In March 2014, teachers in Argentina went on strike because their unions could not agree wage rates. The government proposed a $25\%$ pay rise, but the unions wanted an increase that was above the country’s $32\%$ inflation rate. The government argued that very large pay rises would lead to unemployment. It also said the economy’s outlook would shortly strengthen because it had devalued the country’s exchange rate at the beginning of the year.
(a)[2]
Define the term ‘trade union’.
(b)[4]
Explain two factors that influence the strength of a trade union.
(c)[6]
Analyse how wage increases may lead to unemployment.
(d)[8]
Discuss whether a government should devalue the country’s exchange rate.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A body / organisation / association / group of people” …