State the reasons behind exchange rate overshooting.

Exchange rate overshooting occurs when the exchange rate responds more sharply than necessary to a change in economic conditions, only to correct itself later. This phenomenon can be explained through various economic theories and mechanisms:

1. Sticky Prices: One key reason for exchange rate overshooting is the presence of sticky prices in the short run. According to the Dornbusch overshooting model, when there is a monetary policy shock (such as an unexpected increase in the money supply), the nominal exchange rate initially overshoots its _________ _________ ________ _____ _______ ______ _____ ____ __________.
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