Some legal issues, both the pure legal, and the social response, will vary by where you are in the US. Since silly places like CA and NJ are on my NFE list, I don't worry about their weird views; if you are there, you better know what is going to be the likely response. The generally best answer is going to be C. If you directly see the knife wielder unjustified stabbing*, circumstances dictate tactics. If I see a cop under attack and I can respond without looking like another assailant, I'm going to do what I can, too. (It is easier than most other cases, clearly, with a uniformed officer.)

Liability if the offender keeps shooting after you have shot him? Not bloody likely, and certainly not something that would make me worry. The correct response is to keep doing what is needed until you perceive that the offender is no longer a threat anyway. If that means dumping a mag of your carry ammo into him, and reloading and doing it again because he is still doing what justified shooting, SHUT UP AND BE DECISIVE.

*A couple days ago in Seattle, a pair of drunk off-duty fire fighters and the girlfriend of one of them started a fight with a homeless guy and used various means of assaulting him until he defended himself with a knife. Such situations can be uncertain. The three A-Hs got charged.

BTW: OP, you need to absolutely KNOW FOR SURE where you can and can't carry legally. I don't care what people like. If it is lawful to carry, there is no excuse for being unarmed. Ever.

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NHI, 10-8.