The CFO of Exeter Corporation is very uncomfortable with its current risk exposure related to the possibility of business disruptions. Specifically, Exeter is heavily involved with e-business and its internal information systems are tightly interlinked with its key customers systems. The CFO has estimated that every hour of system downtime will cost the company about $6,000 in sales. The CFO and CIO have further estimated that if the system were to fail, the average downtime would be about 1 hours per incident. They have anticipated that Exeter will likely experience a total of 100 downtime incidents in a given year without any control activities.

If Exeter pays an annualized cost of $120,000 for redundant computer and communication systems, and another $100,000 for Internet service provider (ISP) support, the total expected number of incidents would be reduced to 40 per year. What would be the dollar amount of Exeter's current residual expected risk if these controls are used? (Enter whole number without dollar sign or comma).