On June 15, Peters orally offered to sell a used lawn mower
to Mason for $125. Peters specified that Mason had until June 20
to accept the offer. On June 16, Peters received an offer to purchase
the lawn mower for $150 from Bronson, Mason’s neighbor.
Peters accepted Bronson’s offer. On June 17, Mason saw Bronson
using the lawn mower and was told the mower had been sold
to Bronson. Mason immediately wrote to Peters to accept the
June 15 offer. Which of the following statements is correct?

(c) Generally an offeror may revoke an offer at any time
prior to acceptance by the offeree. Revocation is effective when it
is received by the offeree. Revocation also occurs if the offeree
learns by a reliable means that the offeror has already sold the
subject of the offer. In this situation, Peters’ offer was effectively
revoked when Mason learned that the lawn mower had been sold
to Bronson. Therefore, Mason’s acceptance was ineffective.
Answers (a) and (b) are incorrect because the offer had been
revoked prior to Mason’s acceptance. Answer (d) is incorrect
because Peters was not obligated to keep the offer open. Note
that if consideration had been paid by Mason to keep the offer
open, an option contract would exist and the offer could not be
revoked before the stated time.