Most of my friends think "It was expensive" is wrong because the question is in the present tense. Do you think "It is expensive." is correct?
There is no law that you must answer precisely the question asked. It's quite common to answer a related question whose answer you do know rather than the question asked. In this case, Tim may have no idea what the current price of the jacket is. But he knows he paid a lot for it, so he conveys the information he has or wants to convey.
For example, someone might ask you, "Are you happy?". And if you don't want to tell them if you're happy now and would prefer to communicate that your happiness has decreased, you might say, "I was happy."
If someone asks you, "Are you going to go to the store tomorrow?" and you already did the shopping you needed to do, you might answer, "I already went to the store". Strictly speaking, you haven't answered the question. But you gave them the information you had and that you thought they wanted to know. Maybe you have no idea whether you'll need something else and wind up going tomorrow, but if you know what they really wanted to know was whether you were still planning to go to get something you previously said you needed, it makes more sense to convey the information you know they want than answer precisely the question asked.
So most of your friends are wrong. There is nothing wrong with answering with the information you think the person asking the question actually wants (or that you have if you don't have the answer to precisely the question asked).