A district cooling plant supply chilled water to an academic complex. The plant is operating 4 units electric chillers each with 300RT capacity to generate the required chilled water. Due to increase operating costs of the chillers, the plant is planning to replace the current chillers with a new chiller with capacity 1,200RT. The altemative 1.200 RT chiller will provide the same level of service as the current chillers. TABLE Q2a and Table Q2b list related costs for defender and challenger. The plant planning period is four years and MARR is 10% a Using PW method determine whether or not the defender should be replaced. [acks! b. Evaluate 4 years marginal cost of defender. Tacks c. Determine the economic life of the challenger. [20 marks] d. Based on the results from part (b) and (c) suggest replacement strategy for the defender. TABLE Q2a Defender Challenger 4x 300 RT= 1200RT 1200 RT new chiller) Market value (year RM 2.5 million 0 Capital investment RM3.0 milion Annual Operating RM0.5 million in Year 1 RM0.3 million in Year 1 and (increase by RM75,000 (increase by RM50,000 maintenance(O&M). every year from year 2 every year from year 2 to year 4) to year 4) Year 0 1 TABLE 02b Defender market value RM2.5 million RM1.8 million RM1.6 million RM1.0 million RM0.5 million Challenger (1200RT - new chiller market value RM3.0 million RM 2.0 million RM1.6 million RM1,3 milion RM1.0 million ? 4