Nitu, I couldn't understand your statement of 2 web servers and 2 application servers.
Your farm musnt have been configured correctly else one box with 8 cores and 32GB RAM could serve 500 users easily.
write your moodle version, PHP version and as well mention are you using ARR as load balancer or some external?
moodle cloud is limited to 1GB, you have to look for moodle partners for solution or setup your own
Now that is a decade old Westmere architecture, none the less would still have easily handled 200+ concurrent, its the DB hoping between the NUMA nodes, the problems is local RAM to cores are faster, but accessing RAM handing to other cores is much much slower, so if for example first set of RAM (allocated to First CPU) is allocated to DB and O/S, and if O/S needs to do something - it swaps the MariaDB <--- this is where trouble begins.
If you can turn it completely off in BIOS, do that, else see if your BIOS can interleave the memory allocation.
in my.cnf add settings
innodb_numa_interleave=1
additionally, add another SSD (256GB would be enough) and put database there alone
how much memory you've allocated to DB?
using OpCache?
Paypal comes integrated with Moodle, it's not a theme's feature, so is zoom, therefore you have to install zoom plug-in additionally.
Harold, your jump to latest version would be
2.3 > 2.7 > 3.1 > 3.5 and finally 3.9
but be assured, your keep updating your PHP and database, as for 3.9 either MariaDB 10.2.29 or MySQL 5.6 is minimum required, unless you have tables format already converted to Barracuda