Final answer:
A decrease in water supply due to the drying up of the Saraswati River or a great flood would have devastated the Indus Valley Civilization's agricultural-based economy, leading to its decline.
Step-by-step explanation:
The question addresses why the drying up of the Saraswati River or a great flood would have had a catastrophic impact on the Indus Valley Civilization. The Indus Valley Civilization thrived on its sophisticated system of agriculture, which was heavily reliant on the water supply for irrigation. Thus, the correct answer is B) Either event would have negatively affected the agriculture (crops and livestock), causing their economy to become unsustainable. Events such as the drying up of the river or flooding could diminish or destroy the crop production and livestock, leading to a decline in the availability of food and trade goods. This would undermine the economic stability and capacity to support the population of their cities. Environmental factors like these are often considered pivotal in the decline of ancient civilizations.