The correct answer is B) It will lose its load and possibly overspeed. When a loss of field excitation occurs in an AC generator operating in parallel with other generators, the generator will lose its load because it can no longer maintain the required voltage and frequency. Without field excitation, the generator's ability to produce voltage and regulate the power output is compromised. This causes the generator to lose its share of the load, and it may begin to overspeed as a result. The other answer choices are incorrect because: A) Decreased armature reaction would not cause the generator to absorb more load, as it would lack the necessary field excitation to do so. C) A field flashover and resulting smoke/overload is not the typical response to a loss of field excitation. D) The inherent speed droop of the governor would not cause the generator to lose its load in this scenario, as the issue is with the field excitation, not the governor.