Look _______ that picture. Isn't it beautiful?
Prepositions are words that indicate relationships with the other words in the sentence. Prepositions of place are used to refer to a place, usually to denote the location of something or someone.
Let's look at the usage of various alternatives in the option as preposition of place:
on : to refer to placement of something attached / adjacent to something else; to refer to something displayed on something else
at : to refer to an exact place where something is situated / event
in : means "inside"
by : to refer the physical location of an object besides some place or some other object
In the sentence the speaker is telling to look at a specific point, a specific thing, i.e. "that picture". Therefore, the most appropriate word here is "at".
Thus, the correct complete sentence is:
Look AT that picture. Isn't it beautiful?
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