What is quantity of trees she should purchase

Reference no: EM13901651

A vendor of seasonal items wants to purchase a number of Christmas trees for the upcoming season. Based on previous years' records, she estimates demand for Christmas trees at her shop to be a normally-distributed random variable with mean μ = 250 and standard deviation σ = 50. If the purchase price for a tree is po = €30 which she then sells at ps = €50, assuming she cannot recover any value at all from any unsold tree, what is the quantity of trees she should purchase in order to maximize her expected profits?

Reference no: EM13901651

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