The answer is C. At first the child misjudges the elderly neighbor when he fears her, and is happy with their new friendship when she helps him.
A has misjudgment but no happiness.
B doesn't match at all
D doesn't say that the rivals misjudged their rivalry or were happy at any point.
People need to be happy with what they have.
He withholds the fact that the falling horseman is the father of the shooter. Enjoy!
To provide the story with conflict and keep the plot going.