Two mutually exclusive alternatives for office building refrigeration and air conditioning are being investigated. Their relevant costs and lives are summarized as follows:

	Absorption Chilling (AC)	Chilling (CC)
Capital investment	$60,000	$80,000
Annual operating expenses	40,000	32,000
Salvage (market) value	10,000	0
Useful life	6 years	9 years

by using the internal rate of return (IRR) method. The MARR is 15% per year. Remember to think incrementally!If the hurdle rate (MARR) is 15% per year and the study period is 18 years, which chilling system should be?