To do additions or subtractions with fractions you need to have the same denominator (the number on the bottom).
For this example, if we multiply 1/4 by 2, we get 2/8 and now both of the denominators are the same because they are both 8. So, now you can just do the sum with the numerators (top numbers) because the denominators are the same. 7 - 2 = 5 so 7/8 - 2/8 = 5/8, which cannot be simplified further, so your final answer would be 5/8.