In order to lose weight, it is needed a balance between what we eat (the input), it means, the calories that gets into the body, and what we lose during the workout (the output). If Nancy eats 2000 calories, she should "use" in some point a little bit more of that so she has a higher output. As the question explains, 1000 calories participate in her normal daily activities, and she burns another 500 more in her workouts. Considering she wants to reduce her weight, she should burn more than 500 calories so she has a positive balance of that output.
Explanation: If Nancy wanted to loose weight she would have to burn more calories than she eats. If she ate 2,000 calories in a day then she would have to burn at least 2,000 calories.