the answer is A. Imperfecto progresivo.
The progressive imperfect is used to express something that was taking place in the past. It is formed using the verb to be in past (in this case: estaba) plus the verb ending in ing (ando, endo, in this case: cantando). It is mainly used for: on-going actions that were happening in the past.
cuando esta lloviendo, when it's raining
So for the usted form, you use the 3rd person singular of the present subjunctive instead of the 2nd person singular present indivatice so, 'hable'
Not sure but I do live in the Dominican Republic