Here are the answers for the phonetics exercise:

**I.** Circle the letter A, B, C, or D to indicate the word whose underlined part differs from the other three in pronunciation.

1. **C** (damage) - the "a" in damage is pronounced differently from the "a" in the other options.
2. **D** (gnvelope) - the "ne" in gnvelope has a different pronunciation due to the silent 'g'.
3. **A** (fun) - the "u" in fun is pronounced differently from the "u" in the other options.
4. **C** (heavily) - the "ea" in heavily is pronounced differently compared to the others.
5. **D** (imitate) - the "i" in imitate is pronounced differently compared to the other options.

**II.** Circle the letter A, B, C, or D to indicate the word that differs from the other three in the position of primary stress.

1. **D** (observe) - has stress on the second syllable while the others typically have stress on the first.
2. **B** (combine) - has stress on the second syllable, while the others have their stress on the first.
3. **D** (between) - has stress on the second syllable, while the others typically have stress on the first.
4. **B** (partner) - has stress on the first syllable, while 'ferry' and 'local' have different stress patterns.
5. **D** (friendly) - has stress on the first syllable, while 'canal' has its stress on the second syllable.

If you need further help or explanations, feel free to ask!