Certified Residential Appraiser Practice Exam

Which of the following is NOT a factor in economic base analysis?

1. The rate of population growth

2. The employment and income generation of local industries

3. The aesthetic quality of urban design

4. The levels of income within a community

The correct answer is: The aesthetic quality of urban design

In economic base analysis, the primary focus is on understanding the economic activities that support a community's income and employment. This approach often examines aspects that directly influence the labor market and economic viability, such as the employment and income generation of local industries, the levels of income within a community, and the demographic trends indicated by the rate of population growth. Conversely, the aesthetic quality of urban design, while important for other aspects of urban planning and community appeal, does not directly impact the economic activities and income generation associated with the community's economic base. It is more related to the social and cultural appeal of an area rather than its economic functionality. Therefore, it does not play a critical role in the analysis of economic fundamentals that drive growth or economic health within a region.