What is an exaggerated statement used for effect called?

The correct answer is hyperbole, which is a figure of speech that involves an exaggerated statement or claim that is not meant to be taken literally. Hyperbole is often used for emphasis or to create a strong emotional response in the reader or listener. For example, saying "I'm so hungry I could eat a horse" uses hyperbole to emphasize one's level of hunger, even though it's not intended to be interpreted literally. This technique enhances the expressiveness of language, making descriptions more vivid and engaging.

In contrast, metonymy refers to substituting the name of one thing with the name of something else closely associated with it, such as using "the crown" to refer to royal power. A simile is a comparison made between two different things using "like" or "as," for instance, "as brave as a lion." The term “figure of speech” is a broad category that includes multiple rhetorical devices, of which hyperbole is a specific type. Thus, hyperbole correctly identifies the specific technique of exaggeration used to create a particular effect.