An air conditioner (AC) consumes 7500 kWh annually with an overall efficiency of COP = 3.0. If

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An air conditioner (AC) consumes 7500 kWh annually with an overall efficiency of COP = 3.0. If this AC is replaced by a more energy-efficient AC (COP = 3.7) at a cost of $3500.

(a) Determine the simple payback period of the chiller replacement.

(b) If the expected life of the old chiller is 15 years, is it cost-effective to replace the chiller in and economy with a discount rate of 7%?

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