A company needs to develop an aggregate operations plan for a product family. Demand for the product family over the next 3 months is as follows:

	January	February	March
Demand:	5,000	4,400	4,700
Capacity:
Regular time	4,000	4,000	4,000
Overtime	500	500	500
Subcontracting	2,000	2,000	2,000

The company’s regular capacity is 4,000 units per month and the company can use overtime and subcontracting to produce up to 500 units and 2,000 units in each month, respectively. There is no beginning (or current) inventory, and there should be no inventory at the end of March. The regular production costs $40 per unit, overtime production $50 per unit, and subcontracting $60 per unit. Inventory-holding cost of $2 is charged per unit against on-hand inventory at the end of each month. Unmet demand is backordered, and backorder penalty cost of $5 is charged per unit for any backorders at the end of each month.

1. If the planner uses the chase strategy, how many units should be produced by using subcontracting in March?

2. If the planner uses the level strategy, what will be the inventory level at the end of January?