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The prob of 3 heads out of five is 5C3x(1/2)^5= 10/32=5/16. , you can also use binominal formula (1/2+1/2)^5. Since the events are independent the probability of first tree being heads is the same as probability of any 3 coins being heads out of 5.

But I think Binomial Distribution only checks a certain results happens K times out N trials. In other words, 3 tosses have heads up out of 5 tosses,
not necessarily "the first three tosses have heads up"

Is the question the same as throwing a coin 3 times and expect
each time it has heads up ?

This questions doesn't explain what it means to flip 5 coins, but only calculate the probability of 3 of them. Are GMAT questions ambiguous like this? Or will they be better defined?