Chronic Obstructive Pulmonary Disease (COPD): The patient's symptoms of progressive shortness of breath, along with the pulmonary function test (PFT) results showing a decreased FEV1/FVC ratio of 54% (which is below the normal range), are indicative of an obstructive lung disease. The lack of significant improvement in FEV1 after administration of albuterol (a bronchodilator) further supports this diagnosis, as COPD is characterized by persistent airflow limitation.

Asthma: Although less likely given the patient's age and the lack of reversibility with albuterol, asthma cannot be ruled out entirely. Some patients with asthma may not show significant reversibility on PFTs, especially if they have severe disease or if they are tested during a period of poor control.
Bronchiectasis: This condition, characterized by permanent dilation of parts of the airways, can cause obstructive symptoms and could be considered given the patient's obstructive pattern on PFTs. However, it would typically require additional diagnostic evidence such as high-resolution CT scans.

Lung Cancer: Although the PFTs suggest an obstructive pattern, lung cancer can cause obstructive symptoms due to tumor location or associated conditions like COPD. It's crucial to consider and rule out lung cancer, especially in an elderly smoker or someone with a significant smoking history, due to its high mortality rate if left untreated.
Pulmonary Embolism: While the chronic nature of the patient's symptoms makes this less likely, pulmonary embolism can sometimes present with gradual onset of shortness of breath. It's a critical diagnosis to consider due to its high mortality rate if not promptly treated.
Cardiac Disease (e.g., Heart Failure): Heart failure can cause shortness of breath and can sometimes mimic obstructive lung disease in its presentation. Differentiating between cardiac and pulmonary causes of dyspnea is crucial, as management and prognosis differ significantly.

Cystic Fibrosis: Although extremely rare in a 77-year-old, cystic fibrosis can present at any age, especially in individuals who are carriers or have a mild form of the disease. It would typically be associated with other symptoms such as recurrent infections or pancreatic insufficiency.
Alpha-1 Antitrypsin Deficiency: This genetic disorder can cause COPD-like symptoms in non-smokers or those with minimal smoking history. It's rare but should be considered in patients with early-onset or severe COPD without a significant smoking history.
Eosinophilic Granulomatosis with Polyangiitis (Churg-Strauss Syndrome): A rare autoimmune condition that can cause asthma-like symptoms, eosinophilia, and vasculitis. It's a diagnosis of exclusion and would require additional laboratory and clinical findings to support it.