You can choose Attach Project Sources to include metadata that Studio requires to reimport the deployable file as an open Mule project into your workspace. You must keep the Attach Project Sources option selected to be able to import the packaged JAR file back into a Studio workspace. But requirement here is to create smallest deployable archive that will successfully deploy to Cloudhub. Hence we can ignore this option.
We need to select Include project module and dependencies
As actual modules and external dependencies required to run the Mule application in a Mule runtime engine Hence correct answer is Select only below option 2) Include project module and dependencies MuleSoft Doc Ref : https://docs.mulesoft.com/studio/7.5/import-export-packages#exporting-a-studio-project-to-a-deployable-mule-application

Correct answer is The city is #[payload.City]
Answer can get confused with the option #["The city is" ++ payload.City] But note that this option will not print the space between is and city name. This will print The city isPune

For such questions always look for Syntax:
I call it "Wrap the Map"
trains:
{(
When mapping array elements (JSON or JAVA) to XML, wrap the map operations in {(..)}
-{ } are defining the object
-( ) are transforming each element in the array as a key/value pair

Error in validation component will get processed by Processer level On Error Propagate block and then error will be rethrown which will get processed by flow level error handler which will set payload to "Error- main flow". Hence correct answer is Error - main flow
1) Request is received by HTTP listener
2) Try scope gets executed
3) The validator component in the Try scope creates an Error Object because the payload is not null.
4) The On Error Propagate handles the error. The payload is set to "Error - Try scope"
6) "Error - Try scope" is returned to the 'On Error Continue' block. Main flow execution stops. Payload is set to "Error - main flow"
7) "Error - main flow" is returned to the requestor in the body of the HTTP request. HTTP Status Code: 200
------------------------------------------------------------------------------------------------------------------------------------------ Reference Diagram though not exactly same, conditions are similar. They will help you answer any new question on error handling in real exam:

https://docs.mulesoft.com/mule-runtime/4.3/on-error-scope-concept#on-error-continue