Find the common difference of the following sequence.

You have the correct answer. It is choice B) -1/4
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Explanation:
This is because we're adding -1/4 to each term to get the next one. In other words, we're subtracting 1/4 from each term to get the next one.
and so on.
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To find the common difference, all we have to do is subtract any term from its previous one.
For example:
d = (term2) - (term1)
d = (1/4) - (1/2)
d = (1/4) - (2/4)
d = (1-2)/4
d = -1/4
The order of subtraction matters, so we cannot say d = term1-term2.