Activity 2 Case Study 1 (10 marks) Alia wrote to Basma offering to sell him a block of shares in Ahsan Ltd. In his letter, which arrived on Tuesday, Alia asked Basma to 'let me know by next Saturday'. On Thursday Basma posted a reply accepting the offer. At 6pm on Friday she changed her mind and telephoned Alia. Alia was not there but her telephone answering machine recorded Basma's message stating that she wished to withdraw her acceptance. On Monday Alia Opened Basma's letter, which arrived that morning, and then played back the message on the machine.

Questions:

a. What is the effect of Alia writing to Basma to offer to sell her shares?

b. What is the effect of Alia's stipulation as to the time the offer is open?

c. What is the effect of Basma's posting a reply?

d. What is the effect of Basma's change of mind? Is there effective communication when a message is left on an answering machine?

e. Which of Basma's two communications is determinative?