Question: Lifetime has collected demand forecasts for its kayaks in Table 2. They would like to compare the total cost of two plans: 1) A chase

Lifetime has collected demand forecasts for its kayaks in Table 2. They would like to compare the total cost of two plans: 1) A chase strategy using hires/layoffs with no inventory and backorders; and 2) A Level strategy using inventory and backorders. To help with the comparison, they have obtained other relevant costs and production information in Table 1. They will start the planning horizon with 0 units in initial inventory. Assume all backorders accumulate.

Table 1
Parameter Value
Previous Month's (Month 0) Production in units 1400
Production cost per unit $190
Hiring cost per unit $50
Layoff cost per unit $90
Cost of holding inventory per unit per month $50
Cost of a backorder per unit per month $90

Table 2
Month Demand
1 800
2 1600
3 3100
4 4600
5 4000
6 2500

Compute the total units of backorders over the planning horizon for the Level Strategy that produces 2570 units each period.

Enter your final answer rounded to the nearest tenth of a unit.

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