“why these two statements are not incompatible” means why these two statements are compatible.
A – Correct
A suggest that the individual movement of galaxies is not related to the overall expansion of the universe. So e.g. galaxies can move at different velocities and directions, meaning that galaxies could move apart but can collide.
B – Wrong
This is too specific and we do not know how fast the Andromeda galaxy is moving towards us.
C – Wrong
This statement does not explain why galaxies collide against each other.
D – Wrong
If spots on a balloon move apart is analogous to galaxies moving apart form each other, then this again, does not explain why galaxies collide against each other.
E – Wrong
The text never says that the Big Bang occurred in the universe. it says the matter of the universe was created in the Big Bang. Also, this does not explain why galaxies move apart from each other and collide with each other.