The best example of a story's historical context is A. the economic situation the author lives in.
The historical context of a story refers to the background and surrounding situations that affect that story. In that way, it is related to the social, cultural, economic and political circumstances that surround that text and that are linked to specific historical moments. As the economic environment is included as part of the historical context of a story, the economic situation in which the author lives in is the correct answer.