Answer:
In the beginning, the narrator feels alone and apart from his new neighbors. Laughing with the other boys over his language mistake breaks down the barrier between him and the others. Once they laugh together, he becomes comfortable being a part of the team. He starts to feel more accepted and hopeful about fitting in as an American.
Is that the correct question?
No, this sentence is not a verb phrase, because the subject is not part of the verb phrase here.
Here's why. The subject is "I," the verb is "believed," and everything following the verb ("every word he said") forms the object of the verb. By definition, a verb phrase is one verb + its various objects or modifiers. Here, "every word he said" operates as one single object (it's not just one word, it's EVERY word, and it's not just every word, it's every word HE said). But the subject is separate from the verb phrase, so the entire sentence is not a verb phrase (it's a subject + a verb phrase).
“This could use more explanation/length.”