This question is a bit theoretical, as the effects of humidity on performance are extremely minor and almost never accounted for, even for small aeroplanes. However, there is technically a very small influence.

Atmospheric air is comprised mostly of Nitrogen (N2), Oxygen (O2) and Argon (Ar) which make up more than 99% of air by volume. Weather patterns on Earth are driven largely by the presence of water vapour (H₂O) in air. The amount of water vapour in air is referred to as humidity. When air is very humid, it is less dense. This is because the water molecules are lighter than Nitrogen and Oxygen molecules, so with more water vapour - the mass is less for a given volume.

If we refer to the lift equation, we can see that if all other factors remain the same, a lower density (ρ) will lead to a decrease in lift.

L = ½ ρV² S C_L

So an increase in humidity decreases air density, and decreases wing lift (provided all other factors remain constant).

Engine performance increases. → INCORRECT

• Engine performance also depends on air density. When the air is denser, a larger mass of air can enter the engine volume, allowing more fuel to be combusted at the optimum ratio. The result is greater engine performance. If humidity increases, it decreases air density, decreasing engine performance.

Lift increases. → INCORRECT

• The opposite occurs, as above.

There is no effect. → INCORRECT

• it could be argued that this answer isn't entirely wrong, as the effect is very small, but the statement that there is no effect whatsoever is not technically correct. In practice, the difference between 0% and 100% humidity will only change air density by less than 1% (at 20°C).

Lift decreases. → CORRECT