Each Dynamics 365 for Finance and Operations standard cloud offer includes three environments:
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Tier-1 environment: Develop and test—One develop/test instance is provided for the duration of the subscription. This instance is a non-production, single-box instance that the customer can use as an automated build environment, or to customize Finance and Operations and do unit testing for the changes. Additional develop/test instances can be purchased separately as an optional add-on.
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Tier-2 environment: Standard Acceptance Testing—One Standard Acceptance Testing instance is provided for the duration of the subscription. This instance is a non-production multi-box instance that customers can use for UAT, integration testing, and training. Additional sandbox/staging instances can be purchased separately as an optional add-on.
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Production environment: One production instance is provided per tenant. The production multi-box instance includes disaster recovery and high availability. It will be provisioned when the implementation approaches the Operate phase, once the required activities in the Microsoft Dynamics LCS methodology and a successful go-live assessment are completed.
In summary, for cloud deployment options, the following table illustrates different environment tiers, and their typical use, deployment, and cost structure:
| Tier | Topology | Used for | Deployment | Cost |
| Tier-1 | One-box environment | Development, Build, or Test | Customer or partner or Microsoft subscription | One Build, one Dev environment in MS subscription.
Can buy an additional subscription or deploy as many as you need in your own Azure subscription. |
| Tier-2 | Multi-box | Test, Golden configuration, UAT | Microsoft subscription | One comes with a license in Microsoft subscription and you can buy additional if you need it. |
| Tier-3 – Tier-5 | Multi-box | UAT, Performance testing | Microsoft subscription | Additional cost. |
| Production | Production | Production | Microsoft subscription | Comes with license. |
In summary, Microsoft provides one development, one build, one Tier-2 environment, and a production environment that might be good enough for simple projects. For a medium or a complex project, you will need to purchase additional add-on environments. Microsoft is working on features to minimize the need and cost of additional add-on development and build environments. For more details, follow this link: https://docs.microsoft.com/en-us/dynamics365-release-plan/2019wave2/dynamics365-finance-operations/developer-tools-as-installable-components.