Correct answer: p³ + 3p²(1-p)
The correct option accounts for the scenarios where the transmitted sequence of three 1s is received with at least two bits still being 1. This includes the case where all three bits are received correctly (probability (1-p)³) and the cases where exactly two bits are received correctly and one is flipped (which can occur in three different ways, hence the factor of 3), leading to the total probability of error being p³ + 3p²(1-p).