A new oil pump costs $7,500 and has no salvage value once installed. The manufacturer's warranty will pay the 1st year maintenance and repair costs. In the 2nd year, costs will be $900, and they will increase on a $700 arithmetic gradient in subsequent years. Also operating expenses for the pump will be $500 the first year and will increase on a $200 arithmetic gradient in the following years. If interest rate is 8%, compute the pump's equivalent annual cost in its 4th year of operation