Transformer contains two coils: primary and secondary. They allow change of voltage to lower or higher value. In first case we have step-down and in second case we have step-up transformer.
Formula used for transformer is:

Where:N1 = number of turns on primary coilN2 = number of turns on secondary coilV1 = voltage on primary coilV2 = voltage on secondary coil
In a step-down transformer primary coil has more turns than secondary coil. So the ratio 1:38 means that for each turn on secondary coil we have 38 turns on primary coil.
We can solve the equation for V2:

Secondary coil provides voltage of 3.16V.