A retailer is considering opening a new store as a business venture. The purchase price of the store will be $2 million and there will be a further investment required of $0.5 million six months after purchase. The store will open one year after purchase. Revenues less running costs are expected to occur continuously and will be $0.1 million in the first year of operation, $0.15 million in the second year of operation, and thereafter increasing at yearly intervals by 4.0% per annum compound. Eight years after purchase, a major refit costing $0.8 million will be required. Sixteen years after purchase, it is assumed that the store will be closed and sold for $6 million. The retailer requires a rate of return on its investment of 7.0% per annum effective. Which of the following is the accumulated profit the retailer will have made at the end of the term?
$867,113.1
$1,391,845.76
$1,468,794.21
$1,577,605.94
$1,696,537.16
$1,765,078.73
Correct $1,941,735.44
$1,965,730.23
$1,973,357.33
$2,212,835.82