OCR GCSE Economics: Economic growth, GDP and unemployment (J205) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions cover sections 3.1 (Economic growth) and 3.2 (Low unemployment) of the OCR GCSE (9-1) Economics specification (J205), Version 2.0 (June 2026), for first assessment in 2019. There are no tiers in this specification. All data is invented for practice: the countries and regions named here do not exist, and each label (Country A to Country E) is used for one economy only. Learn the content first from the study guide and the revision notes. The OCR GCSE Economics hub and the printable checklist show the rest of the course.

Questions

1. State what is meant by Gross Domestic Product (GDP). [2]

2. Country A’s real GDP rises from 1,600 billion units in year 1 to 1,656 billion units in year 2. Calculate the rate of economic growth. [2]

3. In year 1 Country B has a real GDP of 900 billion units and a population of 12 million. In year 2 its real GDP is 936 billion units and its population is 12.48 million.

(a) Calculate GDP per capita in year 1. [2] (b) Explain why GDP per capita in year 2 is no higher than in year 1, although GDP has grown. [3]

4. Annual growth in Country C’s real GDP was: year 2, 2.4%; year 3, -1.8%; year 4, -0.6%; year 5, 1.9%; year 6, 3.4%. Real GDP in year 2 was 500 billion units.

(a) Identify the years in which output fell. [1] (b) Calculate real GDP in year 4, to one decimal place. [3] (c) Explain one limit of using GDP growth alone to judge how well off people are. [2]

5. Explain how more education and training could raise a country’s economic growth. [4]

6. Evaluate whether economic growth always benefits a country. [8]

7. In Country D, 24.6 million people are employed and 1.4 million are unemployed. Calculate the unemployment rate to one decimal place. [3]

8. Explain how the Claimant Count measures unemployment, and why it may give a different figure from the number of people who want a job. [4]

9. Identify the type of unemployment (cyclical, frictional, seasonal or structural) in each case.

(a) A beach cafe worker is out of work every winter. [1] (b) A person leaves one job and spends three weeks looking for another. [1] (c) A factory worker is made redundant because the economy has slumped and spending has fallen. [1] (d) A steelworker’s town loses its only steelworks and local employers want skills the worker does not have. [1]

10. Country E has two regions. Region East has a labour force of 1.5 million, of whom 135,000 are unemployed. Region West has a labour force of 4.5 million, of whom 108,000 are unemployed.

(a) Calculate the unemployment rate in each region. [4] (b) Calculate the national rate and explain why it gives a misleading picture of the country. [2] (c) Each unemployed person costs the government 10,500 units a year in benefits and lost tax. Calculate the total annual cost of the unemployed in both regions. [2]

11. Evaluate the consequences of unemployment for individuals, regions and the government. [8]

Answers

1. GDP is the money value [1] of final output made inside a country over a set period, such as a year [1]. [2] Examiner insight: A strong definition names both what is counted (value of output) and the boundaries (a country, a period). “How rich a country is” is too vague.

2. Growth = (1,656 - 1,600) / 1,600 x 100 [1] = 3.5% [1]. [2] Examiner insight: Show the division by the old figure. A bare answer is risky, because one slip leaves nothing to reward.

3. (a) GDP per capita = GDP / population = 900 billion / 12 million [1] = 75,000 units per person [1]. [2] (b) GDP grew by (936 - 900) / 900 = 4% [1]. Population grew by (12.48 - 12) / 12 = 4% [1]. Output and population rose at the same rate, so GDP per capita is unchanged at 75,000 (936 billion / 12.48 million) [1]. [3] Examiner insight: Use figures from the question in an explain answer. Writing only “population grew faster” would be wrong here, because the rates are equal.

4. (a) Years 3 and 4 [1]. [1] (b) Year 3 = 500 x (1 - 0.018) = 491.0 [1]. Year 4 = 491.0 x (1 - 0.006) [1] = 488.054, so 488.1 billion units [1]. [3] (c) GDP growth says nothing about how income is shared [1], so most people may not be better off even when growth is high (or: it ignores pollution and unpaid work) [1]. [2] Examiner insight: In a chained calculation, apply each year’s growth in turn. Starting from the wrong year, or adding the percentages together, is a common slip. A limit needs a reason attached, not just a name.

5. Education and training raise workers’ skills [1]. Skilled workers produce more per hour, so productivity rises [1]. Higher productivity raises the economy’s potential output, which means higher growth [1]. Evaluation: the effect takes years, and training costs money that could be spent elsewhere, so growth is not immediate [1]. [4] Examiner insight: Analysis needs linked steps (“so”, “which leads to”). A list of benefits does not build a chain.

6. Benefits: growth raises incomes and creates jobs [1]. Higher output brings more tax revenue, which can fund schools and hospitals [1]. Living standards, such as health care and education, can improve [1]. Costs: the gains can go mostly to the richest, so inequality widens [1]. Higher output can mean more pollution [1] and faster use of non-renewable resources, which threatens sustainability for future generations [1]. Evaluation: the answer depends on how growth is produced and shared; clean, widely shared growth benefits most people [1]. Judgement: growth does not always benefit a country, but it can when policies share the gains and protect the environment [1]. [8] Examiner insight: An evaluate answer weighs both sides and ends in a supported judgement. Covering economic, social and environmental points gives breadth, but the judgement must follow from the points you made.

7. Labour force = 24.6 + 1.4 = 26.0 million [1]. Rate = 1.4 / 26.0 x 100 [1] = 5.38…, so 5.4% [1]. [3] Examiner insight: Dividing 1.4 by 24.6 gives 5.7%, which is a different measure. Check that the denominator includes the unemployed.

8. The Claimant Count counts the number of people claiming unemployment-related benefits [1], using government benefit records [1]. It may differ from the number who want work because some unemployed people do not claim, for example due to savings or a partner’s earnings [1], so it can understate unemployment (or: changes in benefit rules alter who can claim) [1]. [4] Examiner insight: The question has two parts, how it measures and why it differs. Make sure each gets its own sentence.

9. (a) Seasonal [1]. (b) Frictional [1]. (c) Cyclical [1]. (d) Structural [1]. [4] Examiner insight: Match the key detail in the scenario, such as winter, three weeks, spending fallen or skills not wanted, to the type.

10. (a) East: 135,000 / 1,500,000 x 100 [1] = 9.0% [1]. West: 108,000 / 4,500,000 x 100 [1] = 2.4% [1]. [4] (b) National: (135,000 + 108,000) / 6,000,000 x 100 = 4.05% (about 4.1%) [1]. This average hides the gap: East has 9.0%, nearly four times West’s rate, so East’s hardship is understated [1]. [2] (c) Total unemployed = 243,000 [1]. Cost = 243,000 x 10,500 = 2,551.5 million units a year [1]. [2] Examiner insight: In calculations with several regions, label each result clearly. The comment should use the numbers rather than just say regions differ.

11. Individuals: lost income lowers living standards and can cause debt [1]. The longer the spell, the more skills fade and health and confidence suffer [1]. Regions: unemployed people spend less, so local shops lose sales and may close [1], and high unemployment can drive away new firms and young people [1]. Government: it pays more in benefits and receives less tax [1], and the opportunity cost is the schools or hospitals the money could have funded [1]. Evaluation: the damage depends on the type and length of unemployment; short frictional unemployment does little harm, while long structural unemployment in one region does the most [1]. Judgement: the consequences are most severe for individuals and regions facing long-term structural unemployment, and the government’s costs grow with them [1]. [8] Examiner insight: The question names three groups, so cover each one. Using the type of unemployment to decide which consequence is worst turns description into evaluation.

Where marks are usually lost

• Dividing by the new GDP figure when finding growth.
• Mixing up GDP and GDP per capita, or ignoring population.
• Using the employed as the denominator of the unemployment rate.
• Rounding too early in a chained calculation.
• Describing a determinant of growth without explaining the link to output.
• Only naming a limit of the data, without saying why it matters.
• Writing about costs of growth with no benefits, or the reverse, in an evaluate answer.
• Treating all unemployment as the same type.

Next steps

• Review the revision notes and re-read the study guide.
• Tick off topics on the printable checklist and see the OCR GCSE Economics hub.
• Use the 10-minute diagnostics to check your weaker areas.
• Book a free trial class to practise evaluation answers with a teacher.

Official syllabus

OCR GCSE (9-1) Economics (J205), Version 2.0 (June 2026), for first assessment in 2019, published by Cambridge OCR. These questions follow sections 3.1 and 3.2.