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Can some kind soul help me understand why C is a better answer than E? To me it seems like both C and E are needed. This is killing me.

The original stimulus supports an argument by attacking the character of someone who opposes the argument. C mirrors this by attacking the character of beauticians that are also implied as opposing the argument.

E is a slippery slope argument, and it still a fairly sound one at that given the context that interest on loans is actually does follow a slippery slope mechanism.

I think we're talking about different problems. The one I'm referencing involves a murder and proving that someone is the murderer.

Read the first sentence of the stimulus very closely. If there is a possibility that someone else was in the office then it may not be either X or Y who committed the crime; it could be the other person. Ruling out the possibility that someone else was in the office would allow for the conclusion to be drawn more strongly thus justifying it.