Drop Down Options:

1. selling OR purchasing

2. goods and services OR financial

3. an increase OR stagnation

4. economic decline OR economic growth

5. goods and services OR monetary payments

6. goods and services OR monetary payments

7. inputs OR outputs

8. goods and services OR money

9. sellers OR buyers

10. sellers OR buyers

b. The financial Planning environment Who Participates in the Financial Planning Environment, and What Do They Do? Financial planning activities are conducted in a dynamic economic environment. In the United States, the economy consists of three major types of participants-consumers, businesses, and government organizations-each pursuing their unique goals and objectives. The interactive activities of these participants create the circumstances in which you conduct your financial planning activities and strongly influence your outcomes. Who are consumers and how do they affect the economic environment? Most people recognize that, as a group, consumers are the pivotal participants in the economy. The decisions made by consumers determine which goods and services will be produced by businesses, just as their investment and saving decisions will strongly influence conditions in the markets. Another indication of the importance of consumers is the effect their collective spending has on the economic activity level observed in the economy. in the level of consumer spending is usually credited with causing and all benefits or costs that go with it. How do businesses contribute to conditions in the economic environment? Businesses sell to consumers and government organizations, providing them with in return for To accomplish this, businesses transform the to the production process provided by consumers (namely land, labor, equipment, managerial talent, and a willingness to take risks) into finished products and services. In return, consumers are paid in the form of rent, wages, interest, and profits. Businesses, or are probably the most constrained participant in the economy, because in the long term their choice of goods and services produced is dictated by the purchasing preferences of consumers and government organizations, or . In addition, businesses are also constrained by the laws and regulations imposed by federal, state, and local government organizations