Explanation:

- Let’s look at the facts: An illiterate man was deceived into signing a bill of exchange. He thought it was a guarantee because of a false statement.

- ? Option 1 (Illegal): The act is not illegal in itself, but invalid due to deception.

- ? Option 2 (Valid): The contract was made by fraud, so it cannot be called valid.

- ? Option 3 (Void): A contract is void when it cannot have any legal effect. But in this case, it is not automatically void.

- ? Option 4 (Voidable): If consent to an agreement is caused by fraud or misrepresentation, the contract is voidable at the option of the party whose consent was obtained fraudulently. Here, the man was deceived, so he can opt to avoid the contract.

Correct Answer: Option 4 – Voidable