Writing the Pricing Model document

We use the following pricing model. Use the Pricing Model template to explain your pricing model the methods you use to determine the value of goods or services as well as how those goods or services will be paid for. For example in the case of manufactured item the pricing model can be fairly simple based on costs of raw materials and labor competitors prices and market demand; and the expectation that standard forms of payment will come from the consumer of that item. In the case of service the pricing model will be largely determined by market competition in the immediate area and the cost will be paid by the consumer of that service. In the case of something less tangible such as share of stock the pricing model can be quite complicated because it must take into account factors such as risk fluctuating dividends historical trends cost of debt and many other factors. External factors such as currency exchange rates price of oil and or precious metals and even political situations can affect pricing model. The world of finance uses variety of complex pricing models; two of the most well known are the capital asset pricing model for evaluating the rate of return for an asset and the binomial options pricing model BOPM for evaluating options. Explain your pricing model here. Be as specific as possible detailing all assumptions included in the model and if appropriate comparing historical data to the pricing model to show its accuracy.