As theog says, run the Upgrade advisor, but judging from the specs alone it will very happily run Win 7 - installing XP would require
drivers for the SATA disk.
Acer's website contains any drivers you may need for WIn 7 - so you should be good to go
http://www.acer.co.uk/ac/en/GB/content/drivers
(note that if you're not in the UK t would be a good idea to go first to
www.acer.com and then select your area, and follow the links to Support, then Drivers and Downloads.)