CAT 2004 VARC Question 19 · Vocabulary

Fallout is the descent of particulate matter which is a resultant of a nuclear explosion or it is an incidental result (consequence) or side effect.
Option 1 has been used in the sense of the first meaning (nuclear fallout).
Options 2 and 3 have been used in the second sense of ‘consequence’ (political and environmental fallouts).
Option 4 is incorrect, as the word has been used in the sentence to mean failure or dropping out (fallout of his good students). Fallout does not mean failure.
Hence, the correct answer is option 4.