Web Activity 1

Find historical data for M1 and M2 published by the Federal Reserve at www.federalreserve.gov (click the "Economic Research & Data" tab). During the past year, which measure of the money supply has increased the least? Which increased the most? Based on what you have learned about the difference between M1 and M2, what might explain why one type of money is increasing faster than the other?

Web Activity 2

Log on to www.federalreserve.gov and access "Economic Research & Data" link. Then click the "Money Stock Measures" link. Use the most current data to calculate:

• The percentage of M1 which is made up of currency
• The percentage of M1 which is made up of demand deposits