145. A company has five employees on its health insurance plan. Each year, each employee
independently has an 80% probability of no hospital admissions. If an employee requires
one or more hospital admissions, the number of admissions is modeled by a geometric
distribution with a mean of 1.50. The numbers of hospital admissions of different
employees are mutually independent.
Each hospital admission costs 20,000.
Calculate the probability that the company’s total hospital costs in a year are less than 50,000.
(A) 0.41
(B) 0.46
(C) 0.58
(D) 0.69
(E) 0.78
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