A company has the cost structure shown in the table and faces a demand in July that exceeds capacity by $200$ units. They enter June with an inventory of zero and a demand equal to capacity. Their best course of action in order to completely fill all of the orders for both June and July by the end of July is to:

Managerial Lever

Cost

Regular production

$$1,\frac{000}{?}$ unit

Overtime production

$$1,\frac{300}{?}$ unit

Subcontracting

$$1,\frac{200}{?}$ unit

Inventory holding

$$100/$unit$/$month

Backlog cost

$$400/$unit$/$month

subcontract $100$ units in both June and July and use $100\%$ of their regular capacity in both June and July.

subcontract $200$ units in July and use $100\%$ of their regular capacity in both June and July.

subcontract $200$ units in June and use $100\%$ of their regular capacity in both June and July.