Current U.S. interest rates and money supply.

Visit the Federal Reserve's Web site atwww.federalreserve.govLinks to an external site.,and select "Data" from the menu items at the top. Then under "Interest Rates,"select "Selected Interest Rates - H.15."

Report the most recent values for the following interest rates:

• Federal funds rate
• Commercial paper/Financial 3-month
• Bank prime rate
• Treasury constant maturity 10-year

Now go back to"Data." Select "Money Stock Measures-H6."

Answer the following questions using Table 1 figures (seasonally adjusted columns):

1. By what percentage has M1 increased/decreased over the last 12 months?
2. By what percentage has M2 increased/decreased over the last 12 months?
3. Explain the relationship between the money supply and interest rates.