One quantity of wheat at Rs 9 30 per Kg is mixed with another quality at a certain rate in the ratio...........

Let the rate of second quality be Rs x per Kg.
C.P of 1Kg wheat of 1st kind = 930p 
C.P of 1 Kg wheat of 2nd kind = 100x p 
Mean price = 1000p
By rule of alligation we have required ratio 8 : 7

   930                         x

         \                  /

        (Mean Price)
                (10)

         /                  \

   x-10        :          0.7     ::       8        :          7

So we get required ratio,  (x-10) : 0.7 :: 8 : 7
⇒ x = 10.80 per Kg

Hence, option 1 is the correct answer.