Let us sort out your given first:
Principal or P = $1,348.00
Rate = 2.5%
t = 18 months
To solve for the simple interest, you use the formula
I = Prt
Where: P = Principal
r = is the rate in decimal form
t = time in years
Because you have the rate in percentage and time in months, first we need to convert:
Rate in decimal form is simple, just divide the value in percentage by 100 so then you will have 0.025 as your rate.
Time in years will be 18 months divided by 12 months = 1.5 years.
Now that you have converted them, you can then solve for the interest by inputting the data you now know.
I = Prt
= $1348.00 x 0.025 x 1.5
= $50.55
Now that you have the simple interest, you can easily find the total of the principal plus interest by adding them together:
P+I
$1,348 + $50.55 = $1398.55
So your answer is B.