Which term describes terminating an offer and creating a new offer by proposing terms of your own?

• A. Lapse of time
• B. Express rejection
• C. Revocation
• D. Counter offer

Answer: (D)

A counter-offer describes terminating the original offer and proposing your own terms in return. When you do this, you’re not just saying “no” to the offer you received; you’re offering a new set of terms. The original offer ends with the counter-offer, and a new offer is created for the other party to consider. Acceptance of that new offer would form a contract if all other elements are present.

This differs from a simple rejection, which ends the possibility of accepting the original terms without proposing anything new. It also differs from revocation, where the person who made the offer withdraws it before it’s accepted, and from lapse of time, which happens when the time limit on the offer runs out.