A. People in another world could not be expected to know maths | B. The possibility of there being an Evil Demon | ||
C. Insanity | D. Dreaming | ||
I don't think he says (A) anywhere. He explicitly says mathematics is not flouted even in dreams. By implication, he thinks the distortion of insanity do not run as far as disting mathematical truths. But he does say, in an argument not listed in these four options, that we sometimes make mistakes in maths and that this argues against our being able to be absolutely certain of mathematical truths. He also invokes the evil demon to this end. So: (B) is the answer.