The correct answer is "operates"
Step-by-step explanation:
Sentences are composed by the subject that performs the action, and the predicate, which includes the verb and other complementary words. For example in the sentence "We go to the school every day" the subject is "we" and the predicate is "go to the school every day".
Moreover, the simple predicate refers to the main part of the predicate, which is the verb. In this context, the complete predicate of the sentence presented is "operates a successful catering business in Walnut Creek", but the simple predicate is simply the main verb or "operates."