Question

A purely competitive firm is in short run equilibrium and its mc exceeds its ac it can be concluded that

Answer 1

Answer would be B that firm is realizing economic profits.

An absolutely competitive firm is in short-run harmony and its MC surpasses its ATC. It may be reasoned that the firm is understanding a financial benefit.  

MC bend is U-molded having both negative and positive slants / slopes whereas curve is certain inclining. So we should not consider negative or descending inclining part of the MC bend. Just rising bit (i.e., upward slanting) of MC is the supply bend. To be increasingly explicit, rising part of the MC the that lies over the AVC bend is the supply bend of an competitive firm in the short run.