Where does the exchange of oxygen and carbon dioxide occur

Alveoli

Explanation:

Alveoli -

Alveoli are the small balloon shaped air sacs, that are present in clusters, in the end of the respiratory system, in the lungs.

They are the most important part of the lung, as the main function of exchange of gases takes place in the alveoli.

Hence, from the given statement of the question,

The correct term is alveoli.