Explanation:

- Initial Distance: The thief and the policeman start 120 meters apart.

- Speed of Thief: The thief runs at 7 km/h.

- Speed of Policeman: The policeman runs at 8 km/h.

- Relative Speed: The policeman gains on the thief at a relative speed of (8 - 7) km/h = 1 km/h.

- Time to Catch Up: At a relative speed of 1 km/h, it will take the policeman 120/1,000 hours (or 0.12 hours) to catch the thief, as 1 km = 1,000 meters.

- Distance Run by Thief: In 0.12 hours, the thief covers 0.12 * 7 km = 0.84 km = 840 meters.

Given these calculations, the correct answer is:

Option:3 - 840 m

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