A proposal that varies in a material way from the original offer, resulting in a new offer?

• A. Acceptance
• B. Restitution
• C. Counteroffer
• D. Forbearance

Answer: (C)

When a response to an offer changes the terms in a material way, it creates a new offer rather than an acceptance. This is because an acceptance must mirror the original terms exactly; any significant change means you’re proposing a different deal, not agreeing to the original one. That new proposal is called a counteroffer, and it terminates the original offer. The party who made the original offer can now accept the counteroffer, reject it, or propose another modification.

For example, if someone offers to sell a car for $5,000, and the other party replies with, “I’ll buy it for $4,500 and pay on delivery,” that response is a counteroffer, not an acceptance. The seller can accept the $4,500 offer, reject it, or propose a different term.

Acceptance, restitution, and forbearance don’t fit this situation. Acceptance would imply agreeing to the original terms without changes; restitution deals with returning value to prevent unjust enrichment; forbearance involves refraining from a legal right and does not create a new offer.