Which of the following describes an agreement to keep an offer open for a set duration?

An option is a specific type of agreement in which one party pays for the right to keep an offer open for acceptance for a predetermined period. This arrangement is often used in real estate transactions, allowing a potential buyer time to consider the offer without the fear of it being revoked. During the option period, the seller is legally bound to honor the terms of the offer while the buyer evaluates their decision. This concept is crucial in real estate to provide buyers with the necessary time to complete due diligence, secure financing, or address any other concerns that may influence their decision-making process.

In contrast, a contract refers to a legally binding agreement that can encompass various forms of obligations between parties. A proposal is generally an initial offer without the binding nature of an option, which does not guarantee that the offer will remain open for a specific time. An agreement is a broader term that signifies a mutual arrangement but does not inherently imply that one party has paid for the exclusivity of an offer being kept open. Therefore, the option is the most accurate term that specifically encapsulates the idea of keeping an offer open for a specified duration.