The correct option is B There is less oxygen.
The process of formation of RBCs is called as erythropoiesis. It is stimulated by decreased oxygen content in the circulation, which is detected by the kidneys, which then secretes the hormone, erythropoietin, which in turn stimulates the proliferation and differentiation of red cell precursors.
So, at high altitude, the oxygen content is low and this stimulates the release of erythropoietin, which results in the increased number of RBCs.
Thus, the correct answer is option B.