Final answer:
The falling action in the story is shown in the excerpt where the young wrens finally feel satisfied, signaling the return to a normal state after the conflict is resolved.
Step-by-step explanation:
The excerpt from the passage "The Willow-Wren and the Bear" that encompasses the falling action of the story is: "And now at last the young wrens were satisfied, and sat down together and ate and drank, and made merry till quite late into the night."
This part of the story follows the climax, where the battle tensions are resolved, and shows the characters beginning to return to their normal state, thus representing the falling action which leads towards the story's conclusion. It details the resolution and the sense of normalcy returning to the characters after the conflict has been resolved, in this case, the bear begging for pardon and the young wrens feeling satisfied.