The argument is only concerned with smoking, so whether or not people have replaced cigarettes with other tobacco products doesn't affect the argument. (A) would be a better answer if the argument was about decreased tobacco use in general.

Like (A), (B) doesn't address the specific argument being made. The argument is about a decrease in the number of smokers, so whether or not existing smokers smoke less doesn't have any impact. And we already know there was a decrease; what we need to affirm is the hypothesized cause, not the phenomenon itself.

To avoid trap answers like (B), it's important to read for detail and be precise in understanding the stimulus. The number of people who smoke and how many cigarettes people smoke are extremely closely related, but still different concepts.

The argument already tells us there was a decrease in the number of people who smoke. Our goal is showing why that happened, not affirming that fewer people smoke now. A decrease in respiratory conditions doesn't help with that.

In other words, there was no price increase despite the extra tax used to fund the ad campaign. (D) eliminates the alternative explanation for why people stopped smoking. This in turn strengthens the argument by leaving it as the last hypothesis standing.

(E) does the opposite of what we're trying to achieve. If smokers have lower incomes, then they're more likely to be price-sensitive. This weakens the argument by making the alternative explanation of a higher cost reducing smoking more convincing.