Answer:
The correct option is the second option: "That's quite OK," she said.
Explanation:
Generally, dialogues are made of two parts: on one hand there is the spoken portion of the sentence, that represents the dialogue itself, and on the other hand, the speaker, which is identified by the dialogue tag.
such parts, the dialogue and the speaker, are frequently separated by a comma.
Bearing the above in mind it could be said that The correct option is the second option: "That's quite OK," she said.
