What is the EAC to keep a piece of new equipment operating? The warranty covers repair costs for the first two years, but expected repair costs are $1900 per year for the rest of the year life. Normal maintenance is expected to cost $2500 annually.There is an overhaul costing $9500 at the end of year 4. The firm's interest rate is 9%.

1. ) $5,103.25
2. ) $5,073.11
3. ) $4,904.65
4. ) $4,965.03