The Influence of Income Changes on the Financial Performance of the Firm

In financial terms, firm performance is an overall result of the firm's activities. It consists of the profits generated by sales of the firm. Obviously, consumers play an important role in this sense, as they are responsible for creating demand for goods or services. They base demand on their incomes. The present study aims to establish the relationship between firm financial performance and consumers' incomes. The research is based on an empirical study on Romanian companies within manufacturing sector. For the purpose of our study, a regression model was used. As a result, we constructed a linear model of regression outlining the impact of income changes over firm financial performance.