This is definitely in unsafe state. The state is not a deadlock state, since every process is not waiting for other processes to release the resources (we have some resources available to fulfill some need). This violates the condition for deadlock :
Circular Wait - A set of processes ${ P0, P1, P2, . . ., PN }$ must exist such that every $P[ i ]$ is waiting for P[ ( i + 1 ) % ( N + 1 ) ].
However, after allocating the remaining resources, the system may go to deadlock, but currently we can only say that it is in unsafe state.
So, the answer is (C).