Call the number of baseballs s, the number of basketballs k, and the total cost of the balls t. Ths, the total cost of the balls purchased is:
2.5s + 5.5k = t
Statement (1) is insufficient. It tells us that s = (1/3)(s + k). Combined with the equation given in the question, we have two equations and three variables. That's not enough to solve.

Statement (2) is also insufficient. It says that k = 2s. Again, combined with the equation in the question, we have two equations and three varaibles.

Taken together, the statements are still insufficient. It may look like we have three equations now, but the equations given by the two statements turn out to be equivalent. Simplify the equation from (1):
s = (1/3)(s+k)
3s = s + k
2s = k
That's the same as the equation in (2). Thus, we only have two equations, but there are still three variables (s, k, and t). Choice (E) is correct.