A possible interpretation of the problem is that we initially had jobs with actual run times 8, 7, 4, and 16. Assuming no new jobs entered the queue, we'd schedule then in increasing order of their times, namely 4, 7, 8, 16 (since that's what SJF means--shortest job first). Under these assumptions we'd have time slices
T2 = 1/2(4+10) =7 --> After first Job has run
T3 = 1/2(7+7) =7 --> After second Job has run
T4 = 1/2(8+7)=7.5 --> After first Job has run
so the fourth job would be given a slice of 7.5, which is choice (3).
This isn't an entirely satisfactory answer since of course the OS might not know how much time the jobs would actually take before hand, but if the problem assumed they'd be run in that order (4, 7, 8, 16) we'd have what was mentioned as the correct answer, so it's at least apossible interpretation.