George: Throughout the 1980s and early 1990s, hardly anyone learned

"merengue and several related ballroom dances" - All the dances come under the umbrella of ballroom dancing. Notice that Boris says related ballroom dances and not related to ballroom dances. Boris basically says that a couple of ballroom dances started gaining popularity in 1995 and the other ballroom dances are now catching on.

Boris fails to undress why these ballroom dances began to gain popularity in the first place.

Can someone please explain why the revival of interest is correct in this question? Revival would mean that ballroom dancing was once popular and then hardly anyone learned it, but there is no mention of any previous popularity of ballroom dancing in the argument. That's why I didn't mark D and got it wrong.

George: Throughout the 1980s and early 1990s, hardly anyone learned ballroom dancing. Why is it that a large number of people now take ballroom dancing lessons?

Boris: It’s because, beginning in 1995, many people learned the merengue and several related ballroom dances. Because these dances are so popular, other ballroom dances are now catching on.

Boris’s response to George is most vulnerable to criticism because it fails to

(A) show that the people who learned the merengue are the same people who are now interested in other ballroom dances - WRONG. Irrelevant. Same or not it makes no impact.
(B) explain why ballroom dancing was so unpopular before 1995 - WRONG. Neither we are concerned about unpopularity nor the period before 1995.
(C) relate the merengue to the forms of dancing that were more prevalent before 1995 - WRONG. Neither relating is true nor we are concerned about what was prevalent before 1995.
(D) account for the beginning of the revival of interest in ballroom dancing - CORRECT. At the first place itself why people have started learning ballroom dancing is what Boris's response fails to elaborate or address.
(E) demonstrate that all types of ballroom dancing are currently popular - WRONG. No at all it projects that all or none are currently popular.

Answer D.

GMATNinja Could you please explain why is D the correct answer?

Here's the essence of the argument: George is baffled because no one was taking ballroom dancing lessons in 80's and early 90's, but now lots of people do. Boris explains that people started learning merengue and other ballroom dances in 1995, and those became really popular, leading to other ballroom dances becoming popular.

But does that really explain anything? How does knowing when some kinds of ballroom dance became more popular explain why ballroom dancing, in general, became more popular?

It would be like explaining that games involving rackets became more popular because squash became more popular. That's circular reasoning. Squash is itself a game with rackets. How did it become more popular?

So Boris still hasn't accounted for the why the revival in ballroom dancing occurred. This is captured in (D).

I hope that helps!