Answer:
B) did not know of the reward when he returned the dog.
Step-by-step explanation:
Since Miguel didn't know about the reward when he returned the dog, he didn't claim it at that moment. The fact that Laredo offered a reward for his lost dog doesn't mean that the dog couldn't return without the reward being paid. For example, if a police officer returned the dog, then he/she cannot claim the reward.
If Laredo told Miguel about the reward and gave ti to him even without Miguel asking, then Miguel can collect it, but if Laredo doesn't say anything then there is no reward to collect.