The correct answer is option C, that is, the warm balloon expands and rises, and the cold balloon shrinks and sinks.
It is known from the ideal gas equation, that PV = nRT
Here, P is pressure, V is volume, n is the number of atoms in gas, R is gas constant, and T is temperature.
From the equation, it is clear that the volume of balloon is directly proportional to the temperature. It signifies that at constant pressure when temperature elevates than at that time volume of the balloon will increase and when temperature reduces the volume of balloon will decrease.
Thus, the volume of warm balloon will increase because of which its density increases and it can rises easily as a less dense substance can easily rises in air in comparison to more dense gas or substance. Thus, the cold balloon shrinks and sinks.