What Occurs at a Lung Volume Equivalent to the Functional

What occurs at a lung volume equivalent to the functional residual capacity (FRC) ?
1) The forces of the chest wall and lungs are in balance.
2) Chest wall expansion is offset by lung contraction.
3) Opposing chest wall-lung forces generate negative P_pl.

A) 1, 2, and 3
B) 1 and 2 only
C) 1 and 3 only
D) 2 and 3 only