EBEL MINING (A)

Ebel Mining Company owns two different mines that produce a given kind of ore. The mines are located in different parts of the country and hence have different production capacities and ore quality. After crushing, the ore is graded into three quality classes, depending on the concentration of a critical mineral: high –grade, medium-grade, and low-grade ores. At the end of each five-day workweek, Ebel has contracted to provide its parent company’s smelting plant with at least 12 tons of high-grade ore, at least 8 tons of medium-grade ore, and at least 24 tons of low-grade ore per week. It cost the Ebel $20,000 per day to run the first mine and $16,000 per day to run the second. However, in a day’s operation the first mine produces 6 tons of high-grade ore, 2 tons of medium-grade ore, and 4 tons of low-grade ore, while the second mine produces daily 2 tons of high-grade ore, 2 tons of medium-grade ore, and 12 tons of low-grade ore.

Questions

1. Develop an Excel model to answer the following question: How many days a week should each mine be operated in order to fulfill the Ebel’s commitments most economically? (It is acceptable to schedule a mine to operate for a fraction of a day.)
2. How sensitive is Ebel’s total weekly cost to the contracted amounts of high-, medium-, and low-grade ore?

Ebel Mining (A) Revisited

Revisit the Ebel Mining (A) Case at the end of Chapter 2. Reformulate that spreadsheet model as an LP and optimize it with Solver to answer its question 1.

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Solution: The downloadable solution consists of 7 pages, 588 words and 1 charts.
Deliverable: Word Document