Offer

Question 1

Offer

Answer 1

An offer is a manifestation of present contractual intent which includes certain and definite terms; is communicated to the offeree; proposes a bargain in which the offeror’s act, forbearance to act, or promise is exchanged for the offeree’s act, forbearance to act, or return promise; and creates a power of acceptance in the offeree.

Question 2

Advertisement

Answer 2

Under the majority rule, an advertisement is not an offer but is merely an invitation for offers. Under the minority rule, if an advertisement includes definite and certain terms, it may be an offer.

Question 3

Revocation

Answer 3

Revocation results from the canceling, annulling, or otherwise voiding of an offer. An offer may freely be revoked by the offeror unless 1) the offer was for a unilateral contract and the offeree has already begun performance, 2) the offer was a firm offer, in which case it terminates at the end of the time stated without the need for further action by any party, or 3) the offeree detrimentally relied on the offer.

Question 4

Revocation Effective upon Receipt by Offeree

Answer 4

A revocation is effective upon receipt by the offeree. A minority view holds that the revocation becomes effective when sent by the offeror.

Question 5

Counteroffer

Answer 5

A counteroffer is an offer by the original offeree regarding the same transaction but containing terms that differ from those proposed in the original offer made by the offeror.

Question 6

Counteroffer as an Implied Rejection

Answer 6

A counteroffer is an implied rejection of the original offer. It is, in effect, a new offer available for acceptance.