The correct answer is C. According to Splunk Cloud Administration slide-deck, slide 100:
When determining priority of app directories in global context, Splunk uses lexicographical order. (Files in apps directory "A" have higher priority than files in apps directory "B".)
In this case, the unix and search apps are placed at the same level of priority, but "S" for search is first than "U" for Unix.
C - Based on Splunk Cloud Administrator book - exactly te same example
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