First, compare "up to" and "in up to." The former is preferable. We don't talk about qualities being "in" people. While deleting the word "in" makes the sentence as written even more ungrammatical, it is incorrect to start with. Because "up to" must be correct, we should focus our efforts on the final two choices.

The central error of (D) is that it is not a complete sentence. The subject is "up to 60 percent of recent college graduates." Everything that follows is a modifier. Compare that to choice (E), in which those college graduates "know" insufficient amounts of something. (E) isn't the most graceful sentence that ever appeared in a GMAT practice question, but it is grammatically acceptable, and the others have clear errors. Occasionally you'll be forced to select the mediocre over the bad.