There is ambiguity. But you should be careful when using pronoun ambiguity to eliminate an answer choice in an SC problem. There are sometimes pronouns that could technically be 'ambiguous' (although maybe not as obvious as your example) in the right answer choice. But, if the other answer choices get rid of the pronoun and fix the ambiguity, you should choose one of them. (If they don't, then you might just be stuck with the 'ambiguous' pronoun.)
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