To apply the cost approach to the property valuation, depreciation including physical deterioration, functional obsolescence and exernal obsolescence should be estimated. For a 20 year old office building designed to last for 50 years, the increase in the operation cost due to functional obsolescence is $32,000 per year. The replacement cost of th eoffice building is $2,000,000. Assumer the discount rate is 10% for the cash flows. How much should be deducted from the replacement value due to functional obsolescence?

A. 960,000

B. 300,000

C. 800,000