Hi ohiovictor,
Did this question come from a GMAT book or a "math" book? I ask because the phrasing of this question is not "in line" with how the Official GMAT will test you on these concepts.
The "intent" of this question is *probably* that since 20 minutes is 1/3 of an hour, then the probability of seeing a car pass is 80%/3 = 26.6666%. However, if this question is from a Statistics class, then the math is different and the answer won't be nearly so simple. Thankfully, the GMAT doesn't test you on complicated Statistics ideas (it sticks to the simple ones).
GMAT assassins aren't born, they're made,
Rich