Please note: different from previous questions, this question is using chase strategy.

Osprey Machine Works has the following demand requirements and other data for the upcoming four quarters. What is the associated cost in quarter 1 if chase strategy adopted?

Quarter	Demand	Previous quarter's output	2500 units
1	2300	Beginning inventory	200 units
2	2400	Stockout (backorder) cost	$50 per unit
3	2600	Inventory holding cost	$10 per unit at end of quarter
4	2100	Hiring workers	$4 per unit
		Laying off workers	$8 per unit

Question 10 options:

	$2500
	$2000
	$3200
	$1600

Hide hint for Question 10
please note: (1) the initial inventory 200 will be used to partly meet the demand of quarter 1. (2) find out the production change of quarter 1 based on previous quarter's level 2500