In South Africa, Christmas falls in the middle of summer, and it is likely to be celebrated with swimming, barbecues, and other northern hemisphere traditional summer activities. Due to geographical differences in sub-Saharan Africa, evergreens are very rare, and they don’t commonly serve as Christmas trees. Instead, indigenous trees such as the yellowwood trees are preferred.

Hans Jansen operates a Christmas tree stand in the Hilibrow neighborhood, the most densely populated neighborhood in the city. He purchases yellowwood trees from a supplier located in the countryside. The supplier has a limited amount of capacity and several customers in other large cities. Because of this, those selling the trees must commit in spring (October) to a number of trees to purchase from the supplier. Jn December, the trees are sold. In January, any unsold trees can be collected by the supplier and liquidated.

The supplier will deliver the Etees to Hans for $50 each. Hans sells the trees for $100 each. Any trees left over will be collected by the Supplier, and Hans will receive $25 per tree collected. Hans will generate sales of between 500 and 1,000 trees, following a normal distribution.

Questions
L How many Christmas trees should Hans order? Develop an Excel-based simulation model to support your decision.
2. Hans is considering moving to an upscale new neighborhood. The new neighborhood’s demand would follow a normal distribution, with a mean of 750 and standard deviation of 100. What would be his expected profit now? Should he move?