The first sentence is filler information that can be ignored, as the question involves lace, not ribbon.
Convert the mixed fraction into an improper fraction.

3 * 5 = 15
15 + 1 = 16
The fraction is now 

.
Divide the fraction by 4, as you want to get 4 equally long pieces.

You get 

, which can be simplified to 

. 
The answer is 
D.