Explanation:

- Option 1: Defended

- "Defended" means to protect or support something against criticism or attack. Using "defended" here doesn’t fit well, as rumours aren't typically defended.

- Option 2: Quashed

- "Quashed" means to reject or void something, especially an idea or rumor. It implies putting a stop to the rumours effectively.

- This is the best fit for the sentence, as the Principal would likely stop and dismiss the rumours.

- Option 3: Cleared

- "Cleared" suggests removing confusion or misunderstanding. This can fit but doesn't strongly convey stopping the rumours as "quashed" does.

- Option 4: Rebuked

- "Rebuked" means to express sharp disapproval. This might fit if referring to scolding the source of the rumours, but isn't as direct as "quashed" in this context.