Step 1: Understanding the Question:
The question refers to the concept of "Magnetic Shielding"—the practice of protecting sensitive electrical instruments from stray external magnetic fields.
Step 2: Detailed Explanation:
Magnetic shielding utilizes materials with a very high magnetic permeability ($\mu$).
When a highly permeable material is placed in a magnetic field, the magnetic field lines strongly prefer to travel through the material rather than through the surrounding air or free space.
Soft ferromagnetic materials (like soft iron or mu-metal) have extremely high permeability. If an instrument is enclosed within a hollow cylinder or box made of soft iron, the external magnetic lines will wrap around the shell through the metal, leaving the interior cavity virtually field-free.
Diamagnetic and paramagnetic substances have permeabilities too close to that of free space ($\mu_r \approx 1$) to effectively redirect field lines.
Step 3: Final Answer:
The instrument should be surrounded by a soft ferromagnetic substance, matching option (a).