First, figure out what 8# and 7# really represent. Since any number followed by the pound sign is 2 raised to that number's power, 8# = 2^8, and 7# = 2^7. That means that we're looking to simplify 2^8 - 2^7.

We could simply calculate each of the numbers, but unless you know powers of 2 by memory, that could be quite time-consuming. Instead, apply exponent rules:
2^8 - 2^7
= (2^7)(2^1) - 2^7
= (2^7)(2 - 1)
= 2^7 = 128, choice (E).