Merit aid is like something you get specially for your studies in terms of discount or scholarships.
Grant is usually given as some money package to help students or institutions to lower the cost of study.
Grant , scholarship and tution discount usually belong to the category of Merid aid. But "work-study program" as name indicates is not for any kind of money or special package.
Work study program is like some routine about how any particular subject or topic should be tought.
we have to select which is NOT considered for merit aid.
Hence "D) work-study program" will be correct answer.