With RIP, remember that the network statement always goes to the
classful boundary. In this case, it's 172.31.0.0. The link R1-R2 is
172.31.12.0/24, which falls under that Class B 172.31.0.0 network. R2
will automatically include it in it's RIP updates. The
passive-interface default command on R2 only tells the router not to
send any RIP updates out the interface. You'd have to use a
distribute-list to prevent unwanted subnets from being advertised.
Hope that helped.
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