Final answer:
Local user account passwords in Splunk are stored in the encrypted etc/passwd file.
Step-by-step explanation:
Local user accounts created in Splunk store passwords in the passwd file. While you might encounter various configuration files in Splunk such as splunk.conf, passwords.conf, users.conf, and authentication.conf; passwords specifically are stored in an encrypted form in the etc/passwd file within the Splunk directory. It is important to note that this file should be handled with care, as it contains sensitive information.