The correct answer is - B. Water vapor would condense into tiny droplets.
When it is hot and sunny, the water is evaporating intensely. It evaporates in the form of water vapor. The water vapor is lighter than the air so it goes further up into the atmosphere. As it reaches the cooler part of the atmosphere the water vapor will start to condensate.
From the condensation onward it will be the reverse process. Once the water vapor condensates, it will create small droplets. The small droplets will than fall back on the Earth, under the influence of the gravity, in the form of precipitation.