Final answer:
Vernacular literature began to appear in 12th-century courts and became popular among educated people, representing a shift from Latin as the exclusively used language of literature to the common tongues of the people.
Step-by-step explanation:
The type of literature that first began to appear in 12th-century courts and became popular among the educated people is C. Vernacular literature. During this period, the traditions of chivalry and the ethos of courtly love became prevalent, especially in the vernacular languages of Europe, rather than in Latin. These narratives comprised poems, stories, legends, and popular songs that were spread by troubadours or wandering minstrels. Latin, on the other hand, was primarily used for religious instruction and by the learned elite across Europe for written communication. While Latin and Greek literature were appreciated and held in high regard, it was the vernacular literature that found a new audience and became widely celebrated in courtly settings.