运筹学代写-IB3A70
时间:2022-03-17
IB3A70

The Practice of Operational Research

Group Presentation (15 CATS), 2021-22

Group Work Instructions
All assessments must be submitted ONLINE via my.wbs by 7pm UK time on the date displayed
against this assessment.

Please ensure that the first page of your presentation includes the Student ID number for each
member of the group, but not your names, and your group number.
Word/Time Limit
10 minute presentation.

Word Count Policy
WBS has a school-wide policy on word counts. This is strictly enforced to ensure consistency across
modules and programme. You can find more information about this policy in your Student
Handbook under Academic Practice - 4i. Word count policy.
This is a strict limit not a guideline: any piece submitted with more words than the limit will result
in the excess not being marked.

Academic Practice
Please ensure you read the full guidelines for Academic Practice in the Undergraduate Handbook
and ensure you understand it. If in doubt, please seek clarification in advance of your submission.
This includes important information on:
• Cheating, plagiarism and collusion
• Correct referencing
• Using internet sources in assessments
• Academic writing
• English Language support
• Word count policy
When you submit your Group Work online, you will be required to tick a declaration box indicating
that the work involved is entirely your own (or that of your Group). Each assessment (where
applicable) will be put through plagiarism software to identify any collusion or inadequate
referencing of materials used from different sources.

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We would consider taking action if your work:
1. Is too reliant on the words of particular authors (rather than presenting your ideas in your
own words), if the assessment uses the ideas or words of an author without referencing
them or putting their words into quotations (plagiarism).
2. Includes unreferenced work that you have previously submitted for any accredited course of
study (unless explicitly asked to do so by your Module Leader/Tutor) (self-plagiarism).

Extensions and Self-certification
Late submissions will incur a penalty of 5% for every 24 hour period after the due date and time, i.e.
this begins one minute after the submission deadline (beginning at 7.01pm).
Requests for specific extensions (of up to 15 days) which are typically for longer and more serious
concerns must be submitted via my.wbs ideally 72 hours BEFORE the deadline. Extensions can only
be approved if you clearly detail your circumstances and provide supporting documentation (or a
reason as to why you cannot provide the supporting documentation at the time) as set out in the
Mitigating Circumstances Policy.
Self-certification is a university-wide policy whereby you are permitted an automatic extension of 5
working days on eligible written assessed work without the need for evidence. WBS permits self-
certification for all types of written, assessed works such as essays and dissertations. It is not
permitted for exams, course tests, or presentations.
You can self-certify twice within each year of study, starting from the anniversary of your course
start date. This will cover all eligible written assessments that fall within the self-certification period,
as long as they have not previously had an extension applied. To find out further details about the
self-certification policy please see: https://my.wbs.ac.uk/-/academic/20778/item/id/1244460/.
If you wish to self-certify for an extension of 5 working days, please select 'Self-certification' in the
Extension Type field. If you wish to request a longer extension than 5 working days, please leave the
Extension Type as 'Standard'.
Further information
Please see the links below for further information on peer assessment and working in groups:
• Overview - Working Online With Others | Academic | my.wbs
• 4.1 Peer assessment and your assessed group task - Study Materials - Working Online With
Others | Academic | my.wbs
• 4.2 WBS policy on group work and peer assessment - Study Materials - Working Online
With Others | Academic | my.wbs

• University of Warwick Values

• Dignity at Warwick page – which includes the Dignity at Warwick Policy

Your assignment instructions begin below.


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IB3A70
Group Assessment
DEADLINE: Monday 28th March, 1900 UK time




THE CRYPTO INVESTOR



CONTENTS
INTRODUCTION .................................................................................................................. 4
THE INVESTMENT QUESTION ........................................................................................... 4
PART 1 – VIDEO PRESENTATION ...................................................................................... 6
PART 2 – BITCOIN MINING INVESTMENT OPTIONS ......................................................... 8
FREQUENTLY ASKED QUESTIONS ................................................................................. 10
ASSESSMENT CRITERIA .................................................................................................. 11


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INTRODUCTION
The early 21st century is a time of rapid change. As long-term trends such as globalisation
and online technology re-shape societies, crises such as the 2008 financial crash and 2020
Covid pandemic force us to adopt different ways of living and working. Academics such as
Russell Ackoff claim we are living through a ‘change of age’.
The changing world makes many feel anxious. Investors, however, see the opportunities.
One such investor is Pat O’Reilly.
O’Reilly made her fortune in the North American food import and export sector. The quiet
life she now leads is in stark contrast to her busy corporate career. O’Reilly developed a
fierce reputation in the sector and was known for her forensic eye for detail and tough
negotiating style. Her employees always listened intently in meetings as she insisted on
never explaining anything twice! “Make sure you take notes, Pat is there’, They would
remind one another.
Having sold the business she built herself, she now resides in rural Ontario, Canada where
she lives with her two Golden Retrievers, enjoying fishing and receiving occasional visits
from her two daughters who are of university age. She doesn’t miss the stormy negotiations,
table thumping and business jargon. A quiet life affords her time to do what she loves:
investing.
Pat is passionate about projects that fit with her outlook and aims to grow her own wealth
while supporting worthwhile initiatives. She describes herself as a ‘socially-conscious’
investor and prioritises ‘ESG’ – the environmental, social and governance aspects of how
companies run.
During fishing trips and dog walks, Pat reflects on the changing world. Though she loves
technology (her previous business gained competitive advantage through innovative use of
big data), she thinks young people get a harsh deal these days. It’s hard for her kids to get
on the property ladder. Job security is low and university fees high. Banks don’t offer
favourable interest rates to encourage money saving. She wonders if the current financial
system better protects established interests better than those of the next generation …

THE INVESTMENT QUESTION
Then, at last year’s family Thanksgiving Dinner, her daughter mentioned Bitcoin.
The topic of cryptocurrency was completely new to Pat, but the possibilities intrigued her: a
de-centralised financial system with no government oversight or control, the goal of
deflationary currency and cutting out the ‘middle man’ in financial transactions. At least
that’s how she understood it! It sounded radical but, from both a business and socio-
economic perspective, it made sense.
If ‘Crypto’ fitted Pat’s investment philosophy well, the question remained: how to invest in the
Cryptocurrency industry?
Pat’s initial research raised as many questions as answers. The simplest way to gain
exposure is to buy Bitcoin, the leading asset in its class, or an alternative Cryptocurrency
known as an ‘altcoin’.
But, the price of cryptocurrency is volatile, and Pat favours business models that offer
consistent returns and create societal benefits, including employment for young people like
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her daughters. Whilst simple currency acquisition remains an option, Pat wishes to explore
other avenues too. Is it possible, for example, to set up a small business operating in some
part of the Cryptocurrency industry?
Bitcoin mining seems interesting, and Pat knows her connections in the industry can help
her source the required equipment. But does the high energy consumption conflict with ESG
objectives? And, what would a business model for Bitcoin mining actually look like?
Another idea revolves around educating people about Cryptocurrency. A YouTube channel
with informative videos about the sector could attract a lot of attention – but how would it
make money? Then her daughters mention TikTok …
Excited if a little confused by the possibilities, Pat resolved to move into the Cryptocurrency
sector around the turn of the year. With much enthusiasm for the project but a lack of clarity
about the way forward, Pat enlists the help of your consulting team.
The key question: how should she ‘invest’ in the sector?

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PART 1 – VIDEO PRESENTATION
With your group, create a video presentation of no more than 10 minutes in length to help
Pat understand how best to invest in the Cryptocurrency industry.
The purpose of the presentation is to explain investment options to Pat, focusing on two
main areas:
1) Evaluation of two (or more) possible Cryptocurrency business models including
Bitcoin mining
2) Presentation of two (or more) plans for Bitcoin mining specifically (see part 2)
Your explanations should be supported by analyses using techniques and approaches from
the module. Remember, Pat has an eye for detail and values evidence-based decision
making.
You are expected to undertake some research into the Cryptocurrency industry. Whilst
detailed technical explanations are not required, basic knowledge of successful business
models in the industry will help.
Once your presentation is complete, submit it to my.wbs before the deadline which is on the
first page of this document.
PRESENTATION SPECIFICATION
A recommended structure for the presentation is as follows. Note: this is not the only way to
structure the presentation, nor is it exhaustive in terms of what you should include. Rather, it
tells you what the main parts should be.
1. A rich picture or causal map to give an overview of the current situation in
Cryptocurrency
Your group should decide which problem structuring method to use, and how to frame
and structure the situation. A rich picture could view the situation from the perspective of
a particular individual or entity in the sector, for example. A causal map might focus on a
key issue or initiative relevant to this sector, and the causes / consequences. Include
helpful commentary to help Pat understand your application.
2. A baseline systems model to show how a business model might work
Your group should choose one promising Cryptocurrency business model, based on
your research of the industry, that Pat could invest in. Bitcoin mining is one, but there are
many others. Use SSM to develop a model to visualize the business model including
activities, strategic objectives and performance measures. Briefly explain what SSM is
and how it helps in this situation.
3. A spreadsheet model showing your analyses of the Bitcoin mining problem – more
information in part 2
Use the information provided in part 2 explain the spreadsheet model to Pat, analyse the
problem and present one or more mining rig acquisition strategies. Your strategies
should optimize profitability or other goals you think important. In the presentation, you
should justify your recommendations. Remember, Excel models are often better
explained using visuals rather than clicking through numbers.
4. A decision analysis (MCDA) model to show which business might work best
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Clearly, Bitcoin Mining is one possible business model to pursue. But, your presentation
should also cover at least one other option for profitable businesses in the sector. Use
an MCDA model to explore the options and the pros / cons of each. Briefly explain how
MCDA can help investors such as Pat make business decisions.
5. An overall narrative that connects the parts and gives the presentation meaning
Great analyses in isolation do not make a great presentation. In addition to the individual
analyses, ensure you explain your overall approach. For example: why these techniques
in this combination and in this order? How does one analysis lead to the next? Briefly,
what are the limitations of these approaches?
Answers to these questions help create a feature of any good presentation: overall
narrative. Note you should attempt to justify not just describe your approach to win
credit for Critical Evaluation (see Assessment Criteria, below).

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PART 2 – BITCOIN MINING INVESTMENT OPTIONS
Though Pat wishes to evaluate multiple business models in Cryptocurrency, she has taken a
particular interest in Bitcoin mining and asks you to undertake further research in this area.
Her initial findings show she must carefully balance income and costs to create a profitable
business. She asks one of her ‘quants’ (quantitative analysts) to build a spreadsheet model
to help her understand the profitability of Bitcoin ‘mining rig’ acquisition strategies. The
basic model is enclosed with this briefing, and information about the model is included
below.
Though Pat likes data-intensive problems, she needs help from your team to understand the
model and, possibly, to provide some additional analyses. The main problem, however, is
answering the key question: how many mining rigs should she acquire monthly to maximise
profit?
About The Spreadsheet Model
Bitcoin ‘mining’ creates new Bitcoins and supports the Bitcoin network by checking and
confirming transactions. Bitcoin miners are paid in Bitcoin, but Pat intends to convert the
Bitcoin to USD.
Pat wishes to evaluate the profitability of a ‘Chris Contract’1 – an agreement between a
miner (ie. Pat) and mining cooperative to mine a certain amount of Bitcoin each month.
According to the contract, which runs over 12 months, Pat must mine 1 Bitcoin in month 1.
After that, she must increase the number of Bitcoins mined by 20% each month. So, in
month 2, she must mine 1.20 Bitcoin, and 1.44 in month 3. The figure is rounded down to 2
decimal places.
Pat receives income in USD for each Bitcoin mined. For the purposes of the basic model,
assume one Bitcoin to be worth 50 000 USD.
Pat must procure ‘mining rigs’ (powerful computers with special hardware) to mine the digital
currency. Each rig costs 5 000 USD. These systems are notoriously ‘energy-hungry’ – each
requires 500 USD in electricity per month to run.
These costs must be factored into the modelling. According to the procurement agreement,
a fixed number of rigs must be acquired each month for the whole year, beginning with
month 1. The question is: how many rigs should Pat acquire? With a 12-month obligation,
it’s a critical question.
Each rig is capable of mining 0.125 Bitcoin / month.
So, Pat can earn money by mining Bitcoins. However, the Chris Contract stipulates a
certain number of Bitcoin must be mined each month. If this requirement is not met, Pat
incurs a fine of 12 500 USD per (fraction of) un-mined Bitcoin, which must be represented in
the spreadsheet model.
Validation Scenarios
Check the model by testing the below scenarios

1 The ‘Chris Contract’ is a fictional concept
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Scenario 1: Show that if Pat acquires 1 rig, $6250 is generated in revenue against
$16437.50 cost in month 1 (including cost of un-minded coins), resulting in a loss of
$10187.50 for month 1
Scenario 2: Show that if Pat acquires 20 rigs / month, an overall loss of $17500 is
generated for the whole scenario
Task 1: use tools, techniques and concepts from the module to explain the model to Pat;
you may wish to identify, for example, model inputs, processes and outputs and / or any
features of the model you think are interesting
Task 2: use the model to help Pat understand profit / loss across the 12-month period for
different mining rig acquisition plans.
Help Getting Started
Consider how you can explain the spreadsheet model to Pat in a user-friendly way.
Remember, simply ‘clicking through’ an Excel model is rarely informative, and often
frustrating for the viewer. What tools, techniques and concepts you’ve learned on the
module might help?
Clearly, the most profitable rig acquisition plan is of interest to Pat. A chart might help Pat
understand the range of options available – can you improve on the chart enclosed with the
model? You may also wish to mention interesting plans that meet objectives other than
profitability.
Help Pat understand the dynamics of the business by explaining why the plans given in the
validation scenarios (above) are not profitable.
Though the main decision variable is clear, analyses of other parameters or model inputs, if
presented clearly, may be helpful to Pat.
Extension (Optional)
Use Monte Carlo simulation in Excel to show how the volatility of Bitcoin could affect
profitability. Choose 4 price levels for Bitcoin and allocate a probability to each to create a
custom probability distribution. Then, randomly generate a price for Bitcoin for each month
in the scenario and build this into the model to replace the fixed price figure. How concerned
should Pat be about Bitcoin volatility?
Note: do not attempt to generate a Data Table of profit levels when the model is in
‘simulation’ mode, since Excel generates new random numbers for each result in the Data
Table. Only generate a Data Table with fixed price for Bitcoin.



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FREQUENTLY ASKED QUESTIONS

Question: The presentation is limited to 10 minutes. Is this time limit strictly
enforced?
Answer: Yes, it is strictly enforced. Nothing after 10 minutes will be viewed or assessed.
Pat values her time and conciseness is key.
Q: Should we include ourselves (ie. you and your fellow group members) in the
presentation?
A: Not necessarily. However, your presentation will probably have more impact if somebody
can be seen in the video. Your group should decide how many (or how few) group members
to include in the video – it’s not necessary to show each group member.
Q: How much attention should we pay to video editing?
A: There is no additional credit for elaborate editing techniques such as transitions.
However, basic editing techniques such as ‘zooming in’ or cutting to (parts of) visuals so the
viewer can understand your points should help. Text, for example, should be easily
readable, and slides with too much text can discourage the viewer.
Q: Are definitions of Cryptocurrency terminology required?
A: Assume Pat has a working knowledge of Cryptocurrency terminology. She is comfortable
with terms such as ‘blockchain’, for example, so these do not require extensive explanation.
Basic definition of terms would be helpful, however.
Q: Can we build our own version of the spreadsheet model?
A: You’re welcome to do so. The model is by no means ‘complete’ and can be extended,
improved or re-built.
Q: How should we submit the video presentation?
Once your presentation is complete, upload it to my.wbs before the submission deadline. If
you have any problems with the submission, contact the undergraduate team who should be
able to assist.
Q: We can’t fit everything into a 10-minute presentation! Any tips?
A challenge in this project, and in organizational life generally, is to summarise effectively.
There is a lot of information relevant to this situation; your challenge is to sift through this
and identify the most important parts. There is no need to explain every detail of a rich
picture, for example. Rather, focus only on areas which you think are particularly interesting.
It should feel difficult in places and development / application of your own academic
judgement is required.

More questions? Use the module forum on my.wbs. Do not email the module tutor
who will simply ask you to post queries to the module forum.

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ASSESSMENT CRITERIA
WBS UG Marking Grid: Presentation Skills
Your presentation will be assessed through the below criteria.
1. Comprehension (approximately 35% of total credit)
How much evidence is there of understanding of module content?
This could mean understanding of how a particular technique works, or of the overall
consulting approach taught on the module. The best way to demonstrate
comprehension is through clear explanations of the techniques in the presentation.
2. Analysis (35%)
How effective are the applications of the techniques, and the overall consulting approach
taught on the module?
This could mean, for example, creating a systems model that conforms to the technical
guidelines for systems modelling and that creates real-world insight. The best way to
demonstrate analytical skill is through clear presentation of your applications of the
techniques.
3. Critical Evaluation (20%)
How much evidence is there of understanding of the strengths (and weaknesses) of the
techniques and of the overall consulting approach?
This means not just explaining and applying the techniques and the overall consulting
approach, but also justifying them. Why are these techniques helpful, and why do they
work well in combination? To maximise credit, include some comments on the
limitations too. Remember, the best presentations don’t just describe, they justify.
4. Presentation Skills (10%)
How effective is the presentation of the project?
Common mistakes include a lack of overall narrative, failing to ‘zoom in’ on analyses so
at least some of the detail can be appreciated, and too much text on slides. Make your
presentation as user-friendly as possible.

Final marks are rounded according to the UG 20-point scale.


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