A company is evaluating the use of insurance to mitigate its risk in the event of a market downturn. The company estimates that it has a total risk of a 20% impact on its net income if a market downturn occurs, and the company currently has a net income of $150,000. At what cost should the company take out insurance to mitigate this risk?
a. $25,000 premium
b. $100,000 premium
c. $150,000 premium
d. $200,000 premium or above
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