+1 for B.

'X Among than among' is the correct idiom

A. than
B. than among --> Correct, "inequalities among.. than among"
C. that is so of
D. compared to
E. in comparison with

Hence, B.
_________________

since it is comparative, smaller requires a THAN
comparison requires AMONG
the X among the old is smaller than Xamong young

B
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In the non-underlined portion, we have a comparative adjective in "smaller". On the GMAT, only "than" can follow a comparative degree - everything else, for example, rather than, compared to, as compared to, over, etc. is completely incorrect. This eliminates C, D, and E. Between A and B - we need to compare "magnitude of inequalities among the old" with the underlined portion. Hence, we need a preposition - "among" to compare the relative magnitudes between the two groups of people. Option A compares "magnitude...among the old" with "the young", thus rendering the construction illogical. Hence, the correct answer is B.
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In the non-underlined portion, we have a comparative adjective in "smaller". On the GMAT, only "than" can follow a comparative degree - everything else, for example, rather than, compared to, as compared to, over, etc. is completely incorrect. This eliminates C, D, and E. Between A and B - we need to compare "magnitude of inequalities among the old" with the underlined portion. Hence, we need a preposition - "among" to compare the relative magnitudes between the two groups of people. Option A compares "magnitude...among the old" with "the young", thus rendering the construction illogical. Hence, the correct answer is B.