What happens when an offer is countered?

When an offer is countered, the original offer is effectively rejected. This means that when one party presents a counteroffer, it terminates the original offer made by the other party. The counteroffer introduces new terms that the original offeror can accept, reject, or negotiate further but does not leave the initial offer on the table for consideration.

In contract law, this principle is significant because it clarifies the dynamics of negotiation between the parties. By countering an offer, the understanding is that the initial terms are no longer valid, and any agreement will need to be formed on the basis of the new terms proposed. This process is essential in forming a legally binding contract, as both parties must agree on the same terms for a contract to exist.

The other options do not align with the principles of contract negotiation and formation regarding counteroffers. The original offer does not stand when countered, acceptance is not implied with a counteroffer, and there is no requirement for immediate acceptance of a counteroffer.