Whitewater Rapids Provides Canoes to Tourists Eager to Ride Whitewater

Multiple Choice

Whitewater Rapids provides canoes to tourists eager to ride Whitewater river's rapids.Management has determined that there is one chance in a thousand of a customer being injured or killed.Settlement of resulting lawsuits has an average cost of $850,000.Insurance with a $100,000 deductible is available.It covers the costs of lawsuits,unless there is evidence of criminal negligence.Based on cost-benefit analysis,what is the most that the business should pay for the insurance?

A) $100
B) $500
C) $750
D) $850