A new township requires a water supplly system to be installed. Water needs to be provided to this new development by a pipeline for which a choice between two types of pipe systems must be made. The data shown in Table 2.1 is for pump Type A. Table 2.1: Type A Characteristics Initial capital cost of pipeline Pump equipment cost Annual energy cost Increase in annual energy cost Estimated life: R 145 000 R 48 000 R 6 500 R 57 Pipeline 25 Years Pump equipment 10 Years An economic analysis over 50 years using the equivalent uniform annual cash flow method R 75 000. (EUACF) is required. The total EUACF was calculated for Type B as Which of these pipes is the most economical? Assume: 1. Take the rate of return of 8 % p.a. 2. Zero salvage values for both the pump installation and pipelines at the end of the lives given and renewal/replacement cost to be equal to the initial costs given. A new township requires a water supplly system to be installed. Water needs to be provided to this new development by a pipeline for which a choice between two types of pipe systems must be made. The data shown in Table 2.1 is for pump Type A. Table 2.1: Type A Characteristics Initial capital cost of pipeline Pump equipment cost Annual energy cost Increase in annual energy cost Estimated life: R 145 000 R 48 000 R 6 500 R 57 Pipeline 25 Years Pump equipment 10 Years An economic analysis over 50 years using the equivalent uniform annual cash flow method R 75 000. (EUACF) is required. The total EUACF was calculated for Type B as Which of these pipes is the most economical? Assume: 1. Take the rate of return of 8 % p.a. 2. Zero salvage values for both the pump installation and pipelines at the end of the lives given and renewal/replacement cost to be equal to the initial costs given