26. A “rate cycle” is a period of monetary policy during which the federal funds rate moves from its low point toward its high point, or vice versa, in response to business-cycle conditions. Go to the CANSIM database, and find data from 2000:Q1 to 2017:Q2 on the target overnight interest rate (series V39079), household final consumption expenditure (series V61989012), household consumption expenditure on durable goods (series V61989014), and household consumption expenditure on services

(V61989017). Download the data and convert the daily overnight interest rate series to quarterly frequency.

a. When did the last rate cycle begin and end? (Note: If a rate cycle is currently in progress, use the current period as the end.) Is this rate cycle a contractionary or an expansionary rate cycle?

b. Calculate the percentage change consumer durable expenditures and consumer expenditures on services over this rate cycle.

c. Based on your answers to parts

(a) and (b), how effective was the traditional interest rate channel of monetary policy over this rate cycle?