Which term refers to cancellation by a legally entitled party?

• A. Rejection
• B. Acceptance
• C. Revocation
• D. Lapse of Time

Answer: (C)

Cancellation by a legally entitled party is revocation. Revocation is when the party who has the authority withdraws an offer or rescinds a contract before the other side accepts, effectively ending the possibility of forming an agreement. This differs from rejection (the offeree declines, ending that particular offer but still leaving room for a new offer), acceptance (which creates a binding contract), or lapse of time (the offer expires if not accepted within a set period). So the term that best fits cancellation by the entitled party is revocation.