SharmaRahul10201 Careful--E also uses the plural (graduates'), but in any case, since these words are acting as modifiers, they don't affect whether salaries should be singular or plural. For instance, we say "graduate tuition" and "graduate fees," just as we'd say "school tuition" or "school fees." Either way, "graduate/school" is just a modifier.
THIS9The trouble with E is that it overloads us with modifiers past the point of comprehension. The word THOSE is a flexible relative pronoun. It can refer back to a noun without keeping its modifiers: "Students at my school are more demanding than those at most other schools." THOSE refers just to students, not to students at my school. So we could use something like the structure of D and get away with "those": "The avg salaries of X exceed those of Y." But since E throws all the modifiers in front of the word SALARIES, it's not clear which words to strip off. It can't just be the bare word SALARIES, since presumably we still want to talk about average annual salaries, so E does not express its intended meaning at all clearly.
As for C, be wary of "changes the meaning." First, A has no claim to the correct meaning. We could just as well say that A changes the meaning. Don't rely on the idea of changing the meaning unless 1) after reading all the choices, you are confident that you understand the author's intent, and this choice doesn't express that, or 2) the meaning in this choice doesn't make any sense. In that latter case, it's less a matter of changing the meaning than of failing to express a reasonable meaning at all. In any case, C conveys more or less the same meaning as A, so it's a moot point here.