Step 1: Using the binomial probability formula.
The problem involves binomial distribution, where the probability of success (hitting the target) is \( 0.8 \) and the probability of failure (missing the target) is \( 0.2 \). The binomial probability formula is:
\[
P(X = k) = \binom{n}{k} p^k (1 - p)^{n - k}
\]
where \( n = 10 \), \( k = 2 \), and \( p = 0.8 \).
Step 2: Calculating the probability.
We substitute the values into the binomial formula:
\[
P(X = 2) = \binom{10}{2} (0.8)^2 (0.2)^8
\]
After simplifying, we find that the probability is \( \frac{144}{5^9} \), which makes option (B) the correct answer.