The question can be answered, and in fact, I did it with only one line. However, it takes a little creative thinking and requires not falling into the trap that "line" means "straight line". To do it, simply divide the circle into six pieces as you would with three straight lines, but rather than lift your pencil when you hit the edge with a line, simply go outside the circle, loop around, and basically start the next straight line.
i don't like the "fold the paper" answer, because nothing in the question suggests that the circle needs to be on paper. it could be a crop circle, a circle written on stone, etc. to assume paper is to assume something not given.
given that this is a grade 7 textbook - an age where most students struggle with very basic geometry - i highly doubt that they were looking for a creative answer. thus, while the question can be solved, based on the intended audience i would conclude that the question has an error in it.