Answer is 11- where is that found?
Your approach is correct.
128 entries and each set has 4 entries => 32 sets
5 set bits are required. 12 offset bits for indexing a page
Now, 32-5-12 = 15 bits are there and we need all of them to be used as tag bits as otherwise we cannot identify a page from the tag. (215 possible page can come to a set and minimum 15 bits are needed to identify the page).