The preposition ‘by’ is used along with ‘known’ to emphasize how others perceive something/someone. In the given sentence, Jai’s friend is called Mohammad Khan ‘by’ people, wherein the use of the preposition ‘by’ highlights the agent of the action. Thus in the given context ‘by’ is the suitable answer. So option C is correct. The preposition ‘for’ states the cause or reason for something, which is not apt here. The person is not ‘known for’ being Mohammad Khan, in other words using ‘for’ would mean that he is known because of his name. Thus option D is incorrect. On the other hand both ‘on’ and ‘at’ are inappropriate in the given context since they are prepositions of place and hence unsuitable here. Thus options A and B is incorrect.