At seven, both tasks were still in progress: I cooked dinner and my flatmate was setting the table.
We were cycling home when the rear tyre burst.✓الإجابة الصحيحة
We cycled home when the rear tyre was bursting.
Nina was opening the shop, counted the cash and raised the shutters as three finished steps.
الشرح
The cycling sentence is correct because the longer journey was in progress when the tyre burst. The closest distractor reverses this relationship by making the completed interruption continuous and the background action simple.