I need help please.

[moofta]

It sounds like you haven't actually logged into MySql.

When you logged in with:
mysql -uroot -ppassword

Did it then print out "Welcome to MySQL monitor" (and a bunch of other stuff)? If it didn't, you're not logged in. Sounds like you missed out the step to add mysql to your PATH variable.

The last thing shown would look like:-
mysql>

So when you type in your command it would look like this:-
mysql> create database peq;