Indirect speech;

by Samah

Hi Ola, I got this question in exam to change into the indirect speech;

"I don't know how much it costs" she said

My answer was:
she said that she didn't know how much it costs

The teacher said this is wrong and the correct answer is:
she said that she didn't know how much it costed

Which is correct? I am so confused!
Thanks in advance!

Samah