Determine if the following statements are TRUE or FALSE.Explain your answer if FALSE.

1. (2 Points) "In the long term, a temporary decrease in money supply will lead to an increase in domestic interest rates and depreciation of the foreign currency, all else equal."
2. (2 Points) "Purchasing Power Parity suggests that countries with high domestic inflation rates should experience a high rate of real exchange rate depreciation relative to the currency of countries with lower inflation rates."
3. (2 Points) "Under the gold standard, a country can undo or sterilize the inflationary effects of gold imports through monetary expansion."
4. (2 Points) "The Balassa Samuelson Effect describes the appreciation of the real exchange rate from faster domestic productivity (and hence output) growth in tradeable goods and services."
5. (2 Points) "According to the short-term model (i.e., Asset Approach), foreign exchange rate volatility can be explained by monetary policy shocks and sticky prices."