Answer: B 
Q05.1 is the correct code as it is used to code for thoracic spina bifida with hydrocephalus, which is the diagnosis in the baby. 
Option A is not correct because Q05.0 is used to specify cervical spina bifida with hydrocephalus. Here, the baby is diagnosed with thoracic spina bifida. 
Option C is not correct because Q01.0 is used to specify frontal encephalocele, which is not the diagnosis here. 
Option D is not correct because Q02 is used to specify microcephaly, which is not the diagnosis here.