Consider the exchange rate between the Philippine peso and the euro. Suppose the Philippine government and the Eurozone governments agree to fix the exchange rate $($ER$)$ at $2\mathrm{.}5$ pesos per euro, as shown by the grey line on the following graph.

Refer to the following graph when answering the questions that follow.

At the official exchange rate of $2\mathrm{.}5$ pesos per euro, the euro is Philippine peso is $,$ which means that Filipinos pay exports than they would with a free$-$floating exchange rate. $,$ and the for European

At the official peso price of euros, there is a market. of euros in the foreign exchange

Suppose the governments of the Eurozone and the Philippines reevaluate their currencies so that their official exchange rate is now $1$ peso per $1$ euro. This action results in Of the euro, the first blue line options are $($overvalued$,$ undervalued$)$ the secound blue line have $($undervalued $,$ overvalued $)$ the third blue line have $($ more $,$ less $)$ the fourth blue line have surplus, shortage $)$ and the last blue line have depreactiation $,$apprecitation $)$