Business environment is mainly characterized by various human economic activities including the production, sale, and purchase of goods and services that are carried out with the main objective of earning profits. Generally, the business environment can be described as a set of conditions that facilitate and promote the human economic activities. This environment is basically comprised of the internal business environment and the external business environment. The internal business environment includes the factors that are within the control of business while the external business environment refers to factors that are beyond the control of the business enterprise. One of the most common aspects of the business environment and human economic activities is the economy, which is generally influenced by various factors.
Role of Business in the Economy:
Business is defined as the management and coordination of individuals and resources in order to achieve specific production objectives, with the main goal of making profit. Together with commerce and markets, business generates many benefits for consumers since it's the basis with which these consumers experience an enhanced standard of living. This is mainly because business enterprises obtain resources like labor and equipment that helps them to specialize in the manufacture of specific products and services. Therefore, the role of business in the economy is to improve the variety, quantity, and quality of products and services available to consumers while the prices of these products and services decreases ("The Role of Business in the Economy," n.d.). Therefore, business plays an important role in the economy in impacting the consumers' standard of living. Through the presence of business in the economy, consumers are able to obtain more products and services that enhance their living standards in ways that could be nearly impossible without the existence of business in the economy.
Roles of For-profit and Non-profit Organizations in the Economy:
The for-profit and non-profit organizations play an integral role in the economy because of their significance in the business environment and operations....
The for-profit organizations are involved in the production of goods and services as well as the provision of employment in order to generate financial gains or profits. Similarly, the non-profit organizations are involved the manufacturing of products and services as well as the provision of employment. However, these non-profit organizations are not in the businesses with the aim of financial gain or profits. The non-profit organizations generate revenue, employ individuals, and manufacture products and services with the main goal of serving environmental and humanitarian needs. On the contrary, the for-profit organizations assist in improving the living standards of people through taxes that the government uses in providing facilities to individuals and for societal well-being.
Impact of Current Fiscal and Monetary Policy on the Economy:
In nearly every major trend in the market, there are always some underlying economic factors such as GDP growth rates. The underlying economic trends are significant determines of the event that take place to organizations and their stock prices. The economy is usually impacted by two major types of economic policy i.e. current fiscal policy and monetary policy. The fiscal policy is an economic policy that is initiated by the President or Congress through taxation law and government spending. Since taxation is one of the essential tools in fiscal policy, the government can efficiently transform the amount of disposal income that is available to taxpayers through changing tax laws. Through such measures, the disposable income would go the government rather than consumers and then pass on to companies or business enterprises. Secondly, the government can choose to increase spending through direct purchase of products and services from private firms ("Introduction to the Economy," n.d.). This would in turn increase the flow of money through the economy and enhance the disposable income available to consumers.
The second type of economic policy with which the government can impact the economy is through monetary policy that is initiated by the central bank of a country like the Federal Reserve in the…
