The Johnson family calculates their expected income for the following year to be $40,000, and a fair insurance policy protecting their home would cost them $6,000. In what circumstance would they be willing to pay $7,000 for their insurance? if they have low levels of risk-aversion but have children if they are risk-neutral and not concerned with cost of insurance if they are highly risk-averse and are looking to maximize utility if they calculate that in two years their medical costs will increase