The correct option is B To reduce the energy losses due to eddy current
The iron core of a transformer is made of Laminated silicon steel with special insulated coating to limit Eddy current loss. Electrical steel, also called lamination steel is specialty steel tailored to produce certain magnetic properties, such as a small hysteresis area (small energy dissipation per cycle, or low core loss) and high permeability.
An eddy current is a swirling current set up in a conductor in response to a changing magnetic field. By Lenz's law, the current swirls in such a way as to create a magnetic field opposing the change. To do this in a conductor, electrons swirl in a plane perpendicular to the magnetic field. Because of the tendency of eddy currents to oppose, eddy currents cause energy to be lost. More accurately, eddy currents transform more useful forms of energy, such as kinetic energy, into heat, which is generally much less useful.