Great Deal! Get Instant $25 FREE in Account on First Order + 10% Cashback on Every Order Order Now

ECON 1030 – BUSINESS STATISTICS 1 PROJECT Instructions: This is a group assignment with a minimum group size of two and a maximum group size of three. All group members must be enrolled in the same...

1 answer below »
ECON 1030 – BUSINESS STATISTICS 1 PROJECT Instructions:This is a group assignment with a minimum group size of two and a maximum group size of three. All group members must be enrolled in the same tutorial. There will be two parts to this assignment: Part A: Business ReportPart B: Ministerial BriefThis assignment, along with a Micro-credential component, is worth 40 marks. The allocation of marks is:Part A30Statistical Analysis 22Professional Report8Part B8Sub-total 38Micro-credential*2Total40*This is a separate submission and the grade will appear separately on Canvas for each student.The response to Part A must be provided in the form of a business report with no more than 10 pages (including cover page). The structure of your business report must include 1] A Title, 2] An Executive Summary, 3] An Introduction, 4] Analysis (Part A) and 5] Conclusions. The response to Part B must be provided in the form of a ministerial brief with no more than 200 words and containing no more than three graphs. In addition, you need to complete a Micro-credential on cross-cultural communication. To show evidence of successful completion you need to provide a copy of the badge. You have the option of completing the Micro-credential earlier in the semester and making a separate submission on Canvas. Alternatively, you can provide the badge along with your assignment submission. You have 2 attempts and you need a score of 80% to receive a badge.You must submit an electronic copy of your assignment in Canvas. SHOW YOUR WORK for calculation based questions. See an attached Template of your submission for more details. Only one submission is required per group. Hard copies will not be accepted. It is very important that you submit an assignment cover sheet with all the group members’ signatures at the time of submission. If any dispute arises on your contribution to the group work, the cover sheet will be used as evidence of contribution. This assignment requires the use of Microsoft Excel. If you have Windows, you will need to use the Data Analysis ToolPak. If you have a Mac with Excel 2011, you may need to use StatPlus:MAC LE.Presentation Instructions:Your written report should comply with the following presentation standards:1. Typed using a standard professional font type (e.g. Times Roman), 12-point font size.2. Single or 1.5 line spacing, numbered pages, and clear use of titles and section headings. 3. Delivered as a Word (.doc or .docx) or PDF (.pdf) file 4. Checked for spelling, typographical and grammatical errors. Where relevant, round to 3 decimal places.5. With all relevant tables and charts, the report should be no more than 10 pages long. Problem Description:The blockchain is a decentralized ledger of all transactions across a peer-to-peer network. Using this technology, participants can confirm transactions without a need for a central clearing authority (or a middle man). According to some, replacing the middle man with a revolutionary technology that is faster, cheaper and as secure will greatly improve market efficiency. One application of blockchain technology in finance is the “cryptocurrencies”, with the best known example being “Bitcoin”. Some believe that such a secure, global, and digital currency represents the future of finance, while some are not optimistic about the future of Bitcoin and cryptocurrencies in general. Useful links on blockchain and cryptocurrencies:https://www.data61.csiro.au/en/our-work/safety-and-security/secure-systems-and-platforms/blockchain https://www.pwc.com/us/en/industries/financial-services/fintech/bitcoin-blockchain-cryptocurrency.html Your task is to evaluate recent prices of Bitcoin and based on this evidence whether individuals should invest in Bitcoin. There are two parts to this assignment, each of which is described in detail:Part A XXXXXXXXXX XXXXXXXXXX = 22 marks; professional report = 8 marks) Locate the data file (Assignment_BusStats.xls) on CANVAS. 1. Use the most appropriate type of graph to present the weekly closing price of Bitcoin (BIT) and provide a general description, commenting on the trend. [Topic 1] 2. Calculate the weekly return for BIT and construct a histogram. Does the data on return rates appear normally distributed? On the basis of z-scores do you find evidence of outliers? Hint: the formula for a return is (Current Price – Previous price)/Previous price multiplied by 100. [Topics 1-4] 3. Calculate and interpret the three aspects of Descriptive Analysis for weekly return: Location, Shape and Spread. Hint: make sure you interpret these measures in the context of the data and pay attention to the unit of measurement. [Topic 1] 4. Construct a 95% confidence interval for BIT return and interpret the interval. [Topics 6-7]5. An investment advisor claimed that BIT return is 2%. Do you agree? Justify your reasoning using a two-tailed hypothesis test approach at the significance level of 5%. [Topic 8]6. Repeat steps 1-5 above for another financial stock traded at the Australia Securities Exchange: the Macquarie Group Limited (MAC).7. Explore the association between BIT and MAC returns. Specifically, construct a contingency table for the positive and non-positive returns of the two stocks and calculate the following: a) Prob (BIT return is positive), b) Prob (MAC return is positive), and c) Prob (positive BIT return conditional on positive MAC return). Are returns to BIT and MAC statistically independent? Hint: use the IF function in excel to construct the four joint events: +ve and +ve returns, +ve and -ve returns, -ve and +ve returns, -ve and -ve returns. [Topic 3]Part B (Ministerial Brief = 8 marks) Write a ministerial brief of no more than 200 words containing no more than three graphs on whether you can confidently recommend investing in the Bitcoin, as compared with MAC. Hint: draw on the relevant evidence you have gathered from Part A, as well as other information/evidence not covered here but you believe is useful. Micro-credential (2 marks)Complete a Micro-credential on cross-cultural communication. Help with Group Assignment: Part A, Question 7Create 4 indicators such that:+ +: BIT return is positive, MAC return is positive+ -: BIT return is positive, MAC return is negative- +: BIT return is negative, MAC return is positive- -: BIT return is negative, MAC return is negativeFor each indicator, if the condition is satisfied, the value of the indicator = 1 and if the condition is not satisfied, the value = 0.On Excel, we can use the IF AND command as follows:=IF(AND(A2>0,B2>0),1,0)To create the second indicator (+-) we use the command IF(AND(A2>0,B2<0),1,0), etcOnce we have created all 4 indicators, we can construct the contingency table:MAC+veMAC-veTotalBIT +veBIT -veTotal<< Title of Report in Initial Capital Letters >>Arial (18 points, Boldface)Executive Summary Here you present a one- or two-paragraph summary of the report. This summary should stand alone (no reference to figures or tables in the text) and provides a clear overview of the essential information comprising a report: context to the issue/topic, scope of the investigation, methodology used, and key findings and recommendations. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXIntroductionIn the “Introduction,” make sure that you orient the audience with sufficient background to understand what the problem is and why the problem is important (engage with audience). You also provide: the aims and objectives of the report, a description of research methods, and overall structure of the report.XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXPart A XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXConclusionsThis section summarizes the document and provides closure. The difference between this summary and the executive summary is that the summary in the “Conclusion” is for someone who has read the report. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXReferencesXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXOther notes: a professional report also needs· Page numbering· Informative heading and sub-headings· Numbered sections· Labelled graphs and tables · Nice overall formatting and presentationPart B: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXMicro-credentials on cross-cultural communicationProvide a copy of the badge for each group member who has successfully completed the micro-credential.1How to write a Ministerial BriefWhat is a Brief:Briefings are used to keep decision makers informed about the issues they are responsible for. In government, briefings are the principal means of communication between government managers and their ministers.A briefing note is a short paper that quickly and effectively informs a decision-maker about an issue. A useful briefing note distills often complex information into a short, well-structured document.Characteristics of a good Briefing Note:A well-prepared briefing note quickly and efficiently fills a person in on an issue. The most valuable BN is clear, concise and easy to read. To succeed, a briefing note should be:· short: one to two pages, and always as short as possible· concise: every word is used as efficiently as possible· clear: keep it simple and to the point; always keep your reader firmly in mind· reliable: the information in a briefing note must be accurate, sound and dependable; any missing information or questions about the information should be pointed out· readable: use plain language and design your BN for maximum readability.How is a Briefing Note structured?Briefing notes often follow a standard format .They have three main parts:The purpose (usually stated as the issue, topic or purpose) - states what has happened, is happening, will happen or might happen that requires his or her attention. When appropriate, it states what strengths (internal capabilities), weaknesses (internal vulnerabilities), opportunities (external circumstances that can
Answered Same DaySep 29, 2021

Solution

Shakeel answered on Oct 01 2021
65 Votes
Executive Summary
The purpose of this report is to compare the BIT with MAC for concluding better investment decision. For that purpose, the weekly closing price of both BIT and MAC are taken and few statistical tools are applied. On the basis of some basic analysis, it is found that the average weekly return on BIT is 2.68% much higher than MAC’s 0.39%. However, the risk with BIT is also higher. The std. deviation of weekly return of BIT is 14.72% against MAC’s 3.15%. It is also confirmed with the trend of closing price of BIT and MAC. The price of BIT has observed significant ups and downs, especially from the past two years but MAC’s closing price has been systematic on upward trend with little fluctuation. At 95% confidence level, 2% weekly return on both BIT and MAC is not significantly acceptable. The contingency level shows there is very marginal effect of MAC’s return over BIT. Overall, BIT is independently efficient to give positive return.
Introduction
Bit coin has now become a major virtual cu
ency for most of the financial transaction. Apart from simple transactions, it has now also been assumed as a viable investment avenue. In the last few decades, Bit coin has performed tremendously and assumed to
eak all past record of high price in next couple of years. However, the concept and usage of Bit coin is still in nascent stage and a large section of inventors and traders are unaware of it. Due to absence of any government regulation and virtual in its nature, it is still suspicious how much it will take weight age in future and to what extent traders and investors will treat it as a legitimate cu
ency. But the future prospect is quite impressive. Investors still prefers traditional financial avenues for investment like equity, bond, govt. securities etc. Hence, it is interesting to know the comparative position of BIT and stocks. Therefore, in this paper it is tried to find the investment feasibility of BIT and compares its performance against MAC stocks. For such purpose, the weekly closing price of past six years are taken for both BIT and MAC and certain basic tools including descriptive statistics are applied to check the past trend and future prospect of both. The contingency table is also prepared to check the any relation between returns of BIT and MAC.
Analysis
Part A
1. Following figures 1 shows the trend in closing price of BIT over past six months.
Figure 1: Trend in BIT
The price of BIT was on an average $200 till 2016 and then gradually increases for June 2017. Afterwards, a sharp increase in price can be observed and price touches at the highest level of $25,986 in Dec’2017. Later on it sharply decreases and touches at the level of $4,440 in Dec’18. Then a sluggish upward thrust further propels the price and so, BIT is cu
ently trading at $17,037 in Aug’19.
2. Following figures 2 shows the histogram of weekly returns on BIT over past six years –
Figure 2: Weekly returns
Huge deviation is weekly returns of BIT show the returns are not normally distributed.
3. The descriptive statistics of weekly returns of both BIT are as follows –
    BIT
     
    
    Mean
    0.0268
    Standard E
o
    0.0080
    Median
    0.0137
    Mode
    #N/A
    Standard Deviation
    0.1472
    Sample Variance
    0.0217
    Kurtosis
    6.2975
    Skewness
    1.5145
    Range
    1.2547
    Minimum
    -0.3976
    Maximum
    0.8572
    Sum
    8.9739
    Count
    335
`                 Table 1: Descriptive statistics
The weekly mean return on BIT is around 2.68% while the standard deviation in weekly return of BIT is 14.72%. There is a wide gap between Mean and median value of weekly return of BIT that shows data is not normally distributed. The skewness also confirms that returns’ distributions are rightly skewed. The range of weekly return of BIT is also quit higher.
4. The 95% confidence interval for BIT weekly return is as follows –
Lower limit    =    0.0259
Higher limit    =    0.0276
The range of interval is 0.0017. Therefore, at significance level of 0.05, the weekly return of BIT can significantly be assumed to fall under this range.
5. The claim of 2% weekly return on BIT doesn’t fall under the confidence interval (2.59% - 2.76%), we have significant evidence to reject the null hypothesis of weekly return equal to 2%. Thus, we are not agreed with this statement.
6. Following figures 3 shows the trend in closing price of BIT over past six months.
Figure 3: Trend in MAC
The price of MAC is in upward trend over past six years. In Mar’2013, the price is $37.71 that rises to $122.78 in Aug’19 with little up and down movements. The highest price is $135.99 in Apr’19 while the lowest is $36.02 in Apr’13.
Following figures 4 shows the histogram of weekly returns on BIT over past six years –
Figure 4: Weekly returns
The graph of MAC weekly returns also shows returns are not normally distributed.
The descriptive statistics of weekly returns of MAC are as follows –
    MAC
    
     
    Mean
    0.0039
    Standard E
o
    0.0017
    Median
    0.0047
    Mode
    #N/A
    Standard Deviation
    0.0315
    Sample Variance
    0.0010
    Kurtosis
    1.6103
    Skewness
    0.1491
    Range
    0.2446
    Minimum
    -0.1095
    Maximum
    0.1351
    Sum
    1.3121
    Count
    335
Table 2: Descriptive statistics
The weekly mean return on MAC stock is 0.39%. The standard deviation in weekly return of MAC is 3.15%, much lower than BIT. MAC’s weekly return has also a wide gap between Mean and median values that shows data is not normally distributed. Its skewness also confirms that both returns’ distributions are rightly skewed, although the distribution of MAC returns is less rightly skewed than of MAC. The range of weekly return of MAC is comparatively lesser at 0.2446.
The 95% confidence interval for MAC weekly return is as follows –
Lower limit    =    0.0037
Higher limit    =    0.0041
The range of interval is 0.0004. Therefore, at significance level of 0.05, the weekly return of MAC can significantly be assumed to fall under this range.
The claim of 2% weekly return on MAC doesn’t fall under the confidence interval (0.37% - 0.41%), we have significant evidence to reject the null hypothesis of weekly return equal to 2%. Thus, we are not agreed with this statement.
7. The contingency table for the positive and negative returns of the BIT and MAC is as follows -
    
    MAC
+ve
    MAC
-ve
    Total
    BIT +ve
    109
    80
    189
    BIT -ve
    80
    66
    146
    Total
    189
    146
    335
The probability of positive of return on BIT    =    189 / 335    =    0.56
The probability of negative return on MAC    =    146 / 335    =    0.44
The probability of positive BIT return if MAC return is positive    =    109 / 189 = 0.58
Conclusion
The average weekly return on BIT is 2.68% much higher than MAC’s 0.39%. However, the risk with BIT is also higher. The std. deviation of weekly return of BIT is 14.72% against MAC’s 3.15%. It is also confirmed with the trend of closing price of BIT and MAC. The price of BIT has observed significant ups and downs, especially from the past two years but MAC’s closing price has been systematic on upward trend with little fluctuation.
At 95% confidence level, 2% weekly return on both BIT and MAC is not significantly acceptable. The contingency level shows that there is 56% chance of positive return on BIT and 58% chance that BIT would yield positive return if MAC also yields positive return. Thus, there is very marginal effect of MAC’s return over BIT. Overall, BIT is independently efficient to give positive return. Therefore, for risk takers, BIT is a good avenue for investment while for risk-averse investors, MAC is best choice.
References
Bitcoin is an innovative payment network and a new kind of money (2019). Information retrieved from: https:
itcoin.org/en
Descriptive and Inferential statistics (2019). Information retrieved from: https:
statistics.laerd.com/statistical-guides/descriptive-inferential-statistics.php
Part B
The purpose of this report is to compare the BIT with MAC for concluding better investment decision. For that purpose, the weekly closing price of both BIT and MAC are taken and few statistical tools are applied. However, analysis lacks certain qualitative factors like political, economical, inventors’ behavior pattern and others, the quantitative analysis also lacks in depth research through advance statistical tools.
On the basis of some basic analysis, it is found that the average weekly return on BIT is 2.68% much higher than MAC’s 0.39%. However, the risk with BIT is also higher. The std. deviation of weekly return of BIT is 14.72% against MAC’s 3.15%. It is also confirmed with the trend of closing price of BIT and MAC. The price of BIT has observed significant ups and downs, especially from the past two years but MAC’s closing price has been systematic on upward trend with little fluctuation.
At 95% confidence level, 2% weekly return on both BIT and MAC is not significantly acceptable. The contingency level shows that there is 56% chance of positive return on BIT and 58% chance that BIT would yield positive return if MAC also yields positive return. Thus, there is very marginal effect of MAC’s return over BIT. Overall, BIT is independently efficient to give positive return. Therefore, for risk takers, BIT is a good avenue for investment while for risk-averse investors, MAC is best...
SOLUTION.PDF

Answer To This Question Is Available To Download

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here