When a tree is sold, the salesperson goes into the field and “tags” the tree for

removal from the field and pickup by the customer (typically

multiple trees are included in an order). Tags are colored ribbons that are tied
around the tree. A unique color is used for each order.
Tagging is a ritual done by the salesperson to ensure that the appropriate quality
of tree is selected. Trees that are identified as “not
saleable” are tagged with a special black ribbon and are periodically removed from
the field.

The current data for five trees that will be analyzed in the exercise are shown in
the following table.

TREES EXPECTED YEARLY DEMAND STD DEV QUANTITY FOR SALE INFIELD QUANTITY
Christmas Palm 81 31 74 440
Washingtonia 165 155 374 4
Gumbo Limbo 159 35 70 0
Yellow Poinciana 49 32 42 394
Weeping Podo 185 68 290 226

‘The “expected yearly demand” is an estimate of the demand over the next year for
the tree. The “std dev” is the standard deviation,
measure of the error, that corresponds to the forecast. Forsale and infield
quantities are given, and finally the total number of trees
planted on the farm. The demand forecast and quantities are updated on an ongoing
basis as trees are sold and planted on the farm