The correct answer is option 'A': 1, 2, and 3 are correct.

Suspension-type insulators are commonly used in electrical power systems to support overhead transmission and distribution lines. These insulators consist of a series of insulator discs that are connected together by a metal or fiberglass rod. The insulator discs are typically made of porcelain or composite materials and are designed to provide electrical insulation and mechanical support.

The string efficiency of a suspension-type insulator refers to its ability to distribute the electrical potential across all the insulator discs evenly. When the potential distribution is not uniform, there is a risk of flashover or breakdown occurring at the weakest point, which can lead to interruptions in the power supply or damage to the insulator.

To improve the string efficiency of suspension-type insulators, the following measures can be taken:

1. Using a longer cross-arm: The cross-arm is the horizontal member that supports the insulators. By increasing the length of the cross-arm, the distance between the insulator strings can be increased, reducing the electric field between adjacent strings. This helps in achieving a more uniform potential distribution and improving the string efficiency.

2. Using a guard ring: A guard ring is a metal ring that is installed around the lowermost insulator disc. It is connected to the ground and acts as a shield, preventing the electric field from concentrating at the bottom of the insulator string. By using a guard ring, the electric field distribution is improved, reducing the risk of flashover and improving the string efficiency.

3. Grading the insulator discs: Grading refers to the arrangement of insulator discs in a string in such a way that the voltage across each disc is progressively lower from top to bottom. This is achieved by using insulator discs with different electrical characteristics or by increasing the diameter of the discs towards the bottom of the string. Grading helps in achieving a more uniform potential distribution, improving the string efficiency.

4. Reducing the cross-arm length: This statement is incorrect. Reducing the cross-arm length would decrease the distance between the insulator strings, increasing the electric field and the risk of flashover. Therefore, reducing the cross-arm length would not improve the string efficiency of suspension-type insulators.

In conclusion, statements 1, 2, and 3 are correct, while statement 4 is incorrect. Therefore, the correct answer is option 'A': 1, 2, and 3 are correct.