Lu; DonaldJr. is doing a one year MBA degree at UNSW and his parents lend him $1 million to buy an apartment, which Donald Jr. will sell at the end of his degree. The interest rate on the loan from his parents is 10% per annum and annual rate of physical depreciation on the apartment is 5%. If the price of new apartments increases by 2% over the year, which of the following figures is the best approximation to the annual user cost of capital for the apartment in dollars? (a) $130,000 (b) $120,000 (c) $100,000 (d) $50,000 (e) $25,000