What is the name of the device that connects two computers by means of a telephone line?

The correct answer is option 3.

Concept:

MODEM stands for modulator-demodulator. A modem is a piece of hardware that allows a computer to send and receive data through a phone line, cable, or satellite.

• A modem is a device that sends and receives data through a communication channel like twisted-pair telephone lines, coaxial cables, or optical fibres.
• The modulation technique is used to transform the analogue signal to digital at the source.
• Demodulation is employed at the receiver to transform the digital signal back to the analogue.

Hence the correct answer is Modem.