This is a combinations problem. Essentially you would add all if the possibilities together for each scenario. Just for an easy one, say one cab held 8 people and the other just 1. There would be 9 possible ways for the group to travel with each person traveling alone. If the first cab could take 7 or 8, you would add the 9 you calculated to the number of options for 7 people in one and 2 in the other. To solve this, you will need the number of possible people in each cab.
1). If the largest cab has 5, they can only travel in groups of 5 and 4. Sufficient
2) even though max for the small cab is 4, they could travel with less if the big cab is large enough. Insufficient
Answer: A
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