Why is it correct for C to fold? No gaurantee that B will get knocked out, and if B wins, A will still have a decent stack. If A and B had identical stacks, and there was a large difference is prize money from 2nd to 3rd, I can see it, but I don't get it here. Whether you fold or call you are still gambling.

Besides if this is correct, it is correct because of tournament structure, not hand odds, so it is not really the same thing.