M0 and M1:These are called narrow money.This include coins and
notes in use.Also other equivalents ,that are easily convertible to
cash.
M2:This includes M1 and short term deposits in banks and 24
hour money market funds.
M3:This includes M2, long time deposits and money market funds
that are more that 24 hour maturity.The definitions of these
depends on the country.
M4:This includes M3 and other deposits.
If the interest rate decreases , this will increase the money
kept in hands of people.Or,if the interest rate increases this will
decrease the amount of money kept in hands of people.