Tom offers to buy Jenny's fishing tackle for $500, but she says she wants $600. Tom then proposes a price of $550, but Jenny says she is not interested. Tom is afraid she will walk away from a deal, so he says "OK. I'll accept your offer to sell for $600." There is now a contract between them.

Question

Quizplus · Accepted Answer

Jenny's statement that she wants $600 after Tom's offer of $550 constitutes a rejection of Tom's offer and a counteroffer. When Tom agrees to the $600, he is accepting Jenny's counteroffer, thus forming a contract at that point, not before.

Tom Offers to Buy Jenny's Fishing Tackle for $500, but She