Hi Sara,
a) volume = height x width x length so one bale is 4x2x1 = 8 cubic feet and 1000 bales would have 8000 cubic feet.
b) You can fit 5 bale lengths along the 20 feet side of the shed (20/4 = 5)
You can fit 25 bale widths along the 50 foot side of the shed (50/2 = 25) for a total of 125 bales each one, one foot high.
1000/125 = 8 feet high
You can also fit 50 bale widths along the 50 foot side of the shed (50/1 = 50) for a total of 250 bales, each one 2 feet high.
1000/250 = 4 bales going up from the floor, each one 2 feet high for a total of 8 feet again.
So the answer is 8 feet.
Dan