The correct answer is C. Exaggeration.
Exclamation is the act of crying out in surprise, pain, or other strong emotion. Excellence is the quality of being outstanding or extremely good. Embroidery is the art of decorating fabric with needle and thread. Exaggeration is the act of making something seem larger, better, or worse than it really is.
In the word "exaggeration," the second "g" is unnecessary. The word can be spelled correctly without it.