Final answer:
The correct statement is B, indicating that the potential buyer is the optionee and the seller is the optionor, and the terms and conditions of the sale must be stated for the option contract to be valid. The option right is purchased through consideration, which may or may not be applied to the purchase price.
Step-by-step explanation:
When it comes to the acquisition of an option to purchase a parcel of land, there are several key points to consider regarding the correct legal terminology and the nature of the option contract. An option is a contractual agreement in which the owner of property (the optionor) provides another party (the optionee) the exclusive right to purchase the property at a specified price within a certain timeframe. In this context, the potential buyer is the optionee and the seller is the optionor (B).
For an option to be a valid contract, the terms and conditions of the potential sale must indeed be specified (B). This includes the sale price, the duration of the option period, and any other conditions that both parties agree to (B). Without such terms, the option contract could be considered void for lack of specificity. An option is not a promise by the optionee to enter into a contract in the future; it gives the optionee the right, but not the obligation, to purchase (C).
The consideration for the option right is a payment made by the optionee to the optionor to secure the exclusive right to purchase the property under the terms of the option (D). This consideration typically does not include interest and it is not always automatically applied to the purchase price, unless explicitly stated in the option agreement (D).