Which type of cells line the lungs and blood vessels?

The type of cells that line the lungs and blood vessels are simple squamous epithelium. Simple squamous epithelium is a single layer of flat cells that allows for efficient diffusion of gases and nutrients. It is found in areas where rapid diffusion is necessary, such as the alveoli of the lungs and the capillaries of the blood vessels.

Option A, simple cuboidal epithelium, is not the correct answer because this type of epithelium is typically found in glands and kidney tubules, not in the lungs or blood vessels.

Option B, simple columnar epithelium, is also not the correct answer because this type of epithelium is typically found in the lining of the digestive tract, not in the lungs or blood vessels.

Option D, keratinized squamous epithelium, is not the correct answer because this type of epithelium is found in the skin, not in the lungs or blood vessels.

Option E, stratified squamous epithelium, is not the correct answer because this type of epithelium is found in areas that require protection, such as the skin and the lining of the mouth, not in the lungs or blood vessels.

Therefore, the correct answer is C, simple squamous epithelium.