Each pronoun should agree with its antecedent in c) number. For example: JANE bought the dress SHE saw a few days before. As you can see, <em>she </em>is the pronoun, and <em>Jane </em>the antecedent, and they agree in number - they are both singular.
The last two answers are wrong automatically because they make no sense what so ever. The first answer is wrong because putting it in that sentence doesn't sound correct. So the answer would be B. Peter didn't know <em>which</em> was his.