The correct answer to the question is option 2: "He was not a practical statesman."

Option 1, which suggests that Mohammad-bin-Tughlaq was mad, is not supported by historical evidence and is a baseless assumption.

Option 3 is true - Mohammad-bin-Tughlaq did transfer the capital city from Delhi to Daulatabad. However, this alone does not make him a failure.

Option 4, which states that he waged war with China, is incorrect. There is no evidence to suggest that Mohammad-bin-Tughlaq had any military conflicts with China.

The key reason for Mohammad-bin-Tughlaq`s failure as a ruler was his impractical approach to governance. He made hasty decisions without considering their consequences, such as the transfer of the capital and introduction of a token currency, which led to economic chaos and rebellion.