MS&E 193/293 Fall 2015

Assignment 2 Prompt
Assigned: Wednesday, October 7, 2015
Due: Monday, October 19, 2015 at 3:30pm
Instructions:
1. This assignment includes a decision tree and executive summary and is worth 20% of
your final course grade.
2. The executive summary will be 2 to 3 pages. Student submissions longer than 3 pages
will be penalized. Use 1.5 spacing, Times New Roman 12 pt font, and 1-inch margins.
Please save your work as a Word Document. We will not accept PDF submissions.
References should be cited in the text (as a note with Arabic numerals, e.g. Nuclear
fusion is a nuclear reaction in which two or more atomic nuclei join to form a new type of
atomic nucleus [1].) and added in a Works Cited page at the end of your executive
summary.
3. For your quantitative analysis (decision tree), you may use any decision-making software
you wish, but you must copy your tree diagram into the same document as your
executive summary. It should be formatted to be readable and clean.
4. No software other than a simple spreadsheet program is required. The Course Assistants
will help you with Excel, but we cannot provide support for the wide range of software
platforms that can do this type of analysis.
5. For your qualitative analysis, research using scholarly sources is essential. This research
can include, but should not be limited to, articles in scholarly journals accessible through
Google Scholar, Searchworks or the Social Science Research Network (SSRN)
magazines like Foreign Affairs or the Bulletin of the Atomic Scientists, recent news
events and developments, and required or suggested readings for the course.
6. Please cite your sources in your Works Cited page. (Use Arabic not Roman numerals.)
The reference section should use a formal standard. See the last page of the assignment
for some acceptable examples of good referencing.
7. Your paper will be graded on how well it demonstrates:
Your ability to do a logical analysis of the facts
Your ability to do an objective analysis of the alternatives with the stated
probabilities
Your ability to write clearly and concisely
Your knowledge of the facts and your ability to use the facts to support the
analyses (lecture and external sources)
Due date and submission process:
1. Assignment 2 is due on Monday, Oct. 19 at 3:30pm. It is your responsibility to submit
your assignment correctly and on time.
2. The homework must be submitted on Coursework in your Drop Box. No paper
submissions will be accepted.
3. Name the file with your executive summary in it [Last name/family name]_[First
name/birth name]_Assignment_2 e.g. Kuypers_Marshall_Assignment_2.
4. Please do not check the box to notify the instructors when you upload to your
DropBox.
MS&E 193/293 HW2 Page 1

5. We will be looking at your timestamp to determine the timeliness of your submission.

Late submissions will be accepted but will be penalized.
Penalty

Amount Late

-5%

Same day but after the 3:30 pm deadline

-10%

1 day late (Thursday)

-30%

2 days late (Friday)

-50%

3 days late (Saturday)

-80%

4 days late (Sunday)

No submissions will be accepted after Sunday

Honor code:
1. You may not work with your classmates on this assignment beyond general discussions
of the problem.
Additional notes to students:
THE PROBLEM PRESENTED IS HYPOTHETICAL AND INVENTED TO TEST YOUR
ABILITY TO DO OBJECTIVE ANALYSIS NOT AS A PREDICTION OF WHAT WILL
HAPPEN.
You must accept the probabilities and the centrifuge information as given.
Problem Introduction:
Background:
On July 14, 2015 the E3/EU+31 (China, France, Germany, the Russian Federation, the United
Kingdom and the United States, with the High Representative of the European Union for Foreign
Affairs and Security Policy) and the Islamic Republic of Iran announced what they called a
historic Joint Comprehensive Plan of Action (JCPOA), which will ensure that Irans nuclear
programme will be exclusively peaceful, and mark a fundamental shift in their approach to this
issue.2

1

Also referred to as the P-5+1 (US, UK, France, Russian Federation, China + Germany) and EU.

http://www.state.gov/e/eb/tfs/spi/iran/jcpoa/index.htm
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In September 2015, the Obama administration stopped Congress from blocking the deal in spite
of strong opposition from the Republican majorities. The deal is designed such that Iran must
take actions to extend its breakout timeline the time it will take to produce sufficient highly
enriched uranium for one nuclear device (for the purpose of this exercise assumed to be 25 kg)
from the currently estimated 2 to 3 months to one year for at least the next decade. The Republic
of Iran has committed to among other provisions reducing its installed centrifuges by 2/3,
limiting its existing stockpile of low enriched uranium (LEU) from 10,000kg to 300kg,
permitting regular IAEA access into nuclear facilities, and providing advanced notice of the
construction of new facilities. In return, the United States and the other nations party to the
agreement have agreed to roll back sanctions on Iran according to the schedule stipulated in the
JCPOA. Failure on the part of the Republic of Iran to adhere to the agreement will result in
immediate reinstatement, or snap-back, of sanctions.
As we enter October 2015, implementation of the plan begins according to the terms of the
JCPOA in spite of persistent opposition in the U.S. Congress and in some quarters of Irans
policy community.
The Hypothetical Problem:
The date is April 15, 2016. The U.S. Intelligence Community (IC) reports indications of a
possible clandestine centrifuge site at one of Irans large military bases. Initial reports based on
overhead imagery and human intelligence sources indicate the possibility of 30,000 centrifuges
in a nondescript warehouses on the base. The Israeli IC has picked up similar indications, and
Prime Minister Netanyahu has called upon President Obama to press for U.S. military action to
destroy the warehouses. (For the purposes of your analysis, assume that the IC has confirmed
with absolute certainty the existence of the covert centrifuge site. In reality, intelligence reduces
uncertainty but does not eliminate it.)
President Obama convenes an emergency meeting of the National Security Council to decide
what actions to take in light of this new intelligence. Secretary of Defense Ashton Carter presents
Option A: Conduct a surgical military air strike to destroy the suspect facility. Secretary of State
John Kerry presents two options: Option B: Convince the other parties of the JCPOA to impose
snap-back sanctions to convince Iran to open the facility for inspection and roll back the
potential clandestine centrifuge program. Option C: Take no action so as to allow the current
JCPOA to proceed with scaling back Irans known centrifuge program.
*All events described beyond Oct. 7, 2015 are purely hypothetical. Although they have not
actually transpired, you should assume that they have.
For Option A: In the event of US airstrike, the suspected centrifuge facility will be successfully
destroyed with probability of 0.90. If successful, Iran will rebuild the facility with same capacity
in a different covert location, but construction may take over a year. Based on intelligence, it is
estimated that there is a 0.1 probability that Iran will have a new facility operating with 30,000
P-1 equivalent centrifuges by April 15, 2017. If the strike is not successful, the covert facility
will continue operating through April 15, 2017.

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If an air strike is conducted, regardless of whether or not it is successful, Iran will consider the
JCPOA void and reactivate the full capacity of its Natanz and Fordow centrifuge facilities within
the next year.
For Option B: If the US takes no military action and pursues the diplomatic path with the P5+1, there is a 0.4 probability that the P-5+1 will be convinced by the intelligence and snap-back
the pre-JCPOA sanctions. If sanctions are snapped back in place, Iran will open the covert
facility to inspection and give up its covert pursuit with probability of 0.8. If sanctions are
snapped back in place, Iran will reactivate its Natanz and Fordow facilities with probability of
0.2. On the other hand, if sanctions are not snapped back in place, Iran will proceed with its
covert facility with probability of 0.8. If sanctions are not snapped back in place, Iran will
reactivate at full capacity its Natanz and Fordow facilities with probability of 0.6.
For Option C: If the US takes no military action and decides to prioritize preserving the JCPOA
for the time being, Iran will activate its covert facility within the next year with probability of
0.9. With no public mention of the covert facility, Iran will likely keep the JCPOA commitment
to deactivate the Natanz and Fordow facilities to the levels and at the pace specified in the
JCPOA (with a probability of 0.95). There is a probability of 0.05 that Iran will not comply and
break out with its centrifuge facilities at Natanz and Fordow.
For all options: Although the known centrifuge sophistication at Natanz and Fordow are
different, for the purpose of this problem, you must assume that the two facilities will be
reactivated together for a total capacity of 20,000 equivalent P-1 centrifuges. We would expect a
covert facility to use advanced centrifuges that Iran has been developing, but for this analysis
you must assume that the total capacity of the covert facility is 30,000 equivalent P-1
centrifuges.
You are also not expected to consider the pace at which Iran has been converting its low
enriched uranium per the JCPOA. For this problem President Obama will make his decision
based on minimizing the expected number of P-1 equivalent centrifuges Iran has running
on April 15, 2017.
The Assignment:
President Obama asks his National Security Advisor (NSA) to analyze the three options and
make a recommendation.
You are a senior security analyst.

The NSA asks you to analyze the situation and prepare a two- to three-page executive
summary in which you summarize your assessment of the situation, briefly analyze the
options, present the pros and cons, and make a recommendation based on BOTH your
quantitative and qualitative analysis.
The NSA will use your executive summary to make a recommendation to President
Obama.
The NSA emphasizes that he wants an objective analysis, not your opinion.

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The President is a risk-neutral (expected value) decision maker and seeks to minimize the
total number of P-1 equivalent centrifuges operating in Iran on April 15, 2017.
The intelligence services have provided probabilities for the three options (Table 1). You
cannot question or change these.
You must construct a decision tree to compare the alternatives. The decision tree will
account for 50% of your grade for this assignment.
You must consider qualitative factors in making your recommendation, including the
unintended consequences of each of the alternatives.
Your executive summary should briefly summarize the results of your quantitative
analysis. You should spend no more than one half page summarizing your
quantitative analysis; rather, let your quantitative analysis figures stand for themselves.
The bulk of your executive summary should focus on your qualitative analysis.

MS&E 193/293 HW2 Page 5

Probabilities & Outcomes

Table 1: Probabilities based on Intelligence Estimates
Option A: Air strike option
EVENT

PROBABILITY

If U.S. conducts an air strike it will eliminate covert centrifuge facility

0.90

If U.S. conducts a successful air strike and eliminates covert centrifuge

facility, Iran will rebuild an identical facility within one year

0.10

Option B: Snap-back sanctions

EVENT

PROBABILITY

P-5+1 agree to snap-back sanctions

0.40

If snap-back sanctions are imposed, Iran will open covert facility for
inspection and agree to dismantle it

0.80

If snap-back sanctions are imposed, Iran will reactivate full Natanz and
Fordow facilities

0.20

If snap-back sanctions are not imposed, Iran will open covert facility for
inspection and agree to dismantle it

0.20

If snap-back sanctions are not imposed, Iran will reactivate full Natanz
and Fordow facilities

0.60

Option C: No action option

EVENT

PROBABILITY

If no action is taken, Iran will proceed with covert facility

0.90

If no action is taken, Iran will reactivate full Natanz and Fordow

facilities

0.05

Additional information for both cases for April 15, 2017

OUTCOME

Number of
centrifuges
operating

MS&E 193/293 HW2 Page 6

Covert facility operational

30,000

Natanz and Fordow facilities reactivated

20,000

MS&E 193/293 HW2 Page 7

Examples of good referencing:

Book chapter:
Kapur, P. Chapter Five: Deterring Nuclear Terrorists. In Complex Deterrence: Strategy in the
Global Age, eds. P. M. Morgan, T. V. Paul, and James J. Wirtz. Chicago: University of Chicago
Press, 2009.
Book:
Mozley, R. F. The Politics and Technology of Proliferation, University of Washington Press,
Seattle, 1998.
Newspaper article:
Shultz, G. P., Perry, W. J., Kissinger, H. A., and Nunn, S. Kissinger, Shultz, Perry & Nunn call
for A World Free of Nuclear Weapons. The Wall Street Journal, January 5, 2007.
Peer-reviewed journal article:
Khan, F. H. Nuclear Security in Pakistan: Separating Myth from Reality, Arms Control Today,
Vol. 39, No. 6, (July/ August 2009) pp. 12-20.
Hecker, S.S. Toward a Comprehensive Safeguards System: Keeping Fissile Materials Out of
Terrorists Hands, The Annals of the American Academy of Political and Social Science, 607
(Sept. 2006) pp. 121-132.
Website:
Hellman, M. E. Creating Pockets of Nuclear Awareness. [Accessed: October 30, 2010]
http://nuclearrisk.org/pocket.php
Lecture:
Hecker, S. S. Russia in Transition, New Nuclear Threats, India and Pakistan. MS&E 193.
Stanford University, 13 Oct. 2010. Lecture.

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