Indirect Speech: She asked me how much I had paid for the bag.

Explanation:
When changing direct speech to indirect speech, there are a few things to keep in mind. The main idea is to report what someone said without using their exact words. Here's how the process works:

Identify the Reporting Verb:
The first step is to identify the reporting verb in the sentence. In this case, it is "asked."

Change the Pronouns:
Next, we need to change the pronouns in the sentence to reflect that the speaker is reporting what someone else said. In this case, "you" becomes "I."

Change the Tense:
Since the original sentence is in the present tense, we need to change the tense of the reported speech to match. In this case, "did you pay" becomes "had paid."

Change the Word Order:
Finally, we need to change the word order of the sentence to reflect that it is reported speech. In this case, "how much" comes before "I had paid for the bag."

Putting it all together, the indirect speech version of the sentence is: "She asked me how much I had paid for the bag."