The graph on the right shows that during the Great Depression, the desired reserves ratio r rose dramatically. What do you think happened to the money supply? The money supply fell sharply. The graph on the right shows that the money supply declined following the rise in r. Why? OA. The banking system had greater reserves to support chequable deposits, leading to a smaller money multiplier. B. The banking system had fewer reserves to support chequable deposits, leading to a smaller money multiplier. OC. The banking system had fewer reserves to support chequable deposits, leading to a larger multiplier. OD. The banking system had greater reserves to support chequable deposits, leading to a larger money multiplier. Desired R 0.00 0.05 004 0.03 0.02- 0.01- 0.00 1930 1931 1932 19 Sources: Board of Governors of the Federal Reserve System and Milon Friedman History of the United States, 1867-1960 (Princeton, NJ: Princeton University Pres M1 and the Monetary Base, 1930-19 Money Supply 29- 26- 24- M1 22- 20- 18 10- 14- 12- 10-1 1930 Monetary Base 1931 1932 Sources: Miton Friedman and Anna Jacobson Schwartz, A Monetary History Princeton University Press, 1963) p. 333.