If a country experiences a technological regression, what sequence of events would the Real Business Cycle Model predict?

• A. Increase in aggregate supply, followed by an increase in aggregate demand and employment
• B. Decrease in aggregate demand, followed by an increase in aggregate supply and employment
• C. Increase in aggregate demand, followed by a decrease in aggregate supply and employment
• D. Decrease in aggregate supply, followed by a decrease in aggregate demand and employment

Answer: (D)