Correct option is D
The situation which is presented has occured, due to phenomena knows as Thrashing,means after certain point if we try to increase degree of multiprogramming than CPU utilization decreases drastically.So here system is in thrashing.
As we can see hard disk utilization is 85% this means system is spending more time in Page replacement this is due to increase in degree of multiprogramming.
So as a result,we cannot increase degree of multiprogamming, if we try to increase than CPU utilization will fall more which will result in more time for completion of process.
There is no deadlock as process are executing.
D one is correct if we suspend some prcoess than system can be recovered from thrashing and CPU utlization can also be increase which in overall will improve system performance.