Texas A&M University (TAMU) MGMT209 Practice Exam

An advertisement is legally considered an offer when it contains definite terms that communicate a clear willingness to enter into a contract. This means the advertisement must specify how the terms can be executed, which typically includes aspects such as price, product, and services offered.

While it might seem that the intention behind the advertisement plays a pivotal role, the key factor is how the advertisement conveys these terms. If an advertisement is vague or serves merely to invite negotiation, it is less likely to be seen as an offer. Therefore, it’s crucial for an advertisement to outline specific, measurable details that a consumer can rely upon, thus establishing that it constitutes a legally binding offer if accepted.

The idea that the advertisement is intended as an invitation to negotiate aligns more closely with the premise of general advertisements that aim to stimulate interest rather than create direct obligations. This concept signifies that unless an advertisement provides definite terms indicating the willingness to be bound, it does not meet the criteria of a legally enforceable offer.