Answer:
The correct answer is D. Look out for the monkey that stole my wallet with the broken tail.
Explanation:
A misplaced phrase is a phrase that is located in the wrong position in a sentence. It's usually found too far from the word it is supposed to modify. If you look at sentence D, you will see that the participial phrase 'with the broken tail' is found too far from the word 'monkey' which it is supposed to modify.
The way this sentence is written, it would seem that the wallet has a broken tail, and not the monkey. The correct version of the sentence would be:
Look out for the monkey with the broken tail that stole my wallet.