This question tests the understanding of word usage in context. The correct answer is 'B. Courteous and tactful', as 'graceful' in this context refers to the manner in which the refusal was expressed, implying politeness and consideration. Option A refers to physical appearance, which is not the focus here. Option C suggests a lack of complexity, which is unrelated to the refusal's manner. Option D implies a rough or unrefined manner, which is the opposite of what is described.