Problem
Inhae wants to sell her expensive exercise bike. She messages her good friend Olivia to see if Olivia is interested in buying the bike for $1,000. Olivia says, 'I accept your offer but I can only afford $900. I'll buy it for that price'. Inhae responds, 'OK, I'll bring it over to your place this afternoon'.
On the way to Olivia's house with the bike, Inhae bumps into another good friend, Edgar. He knows that Inhae is interested in selling the bike and tells her that he would love to have it. He offers her $1,250 for it. Inhae is excited to get the extra money and immediately agrees. She messages Olivia to tell her that she has decided to sell the bike to Edgar for the higher price. Olivia is upset and says, 'but we had a contract!'
Task
Is Olivia correct - is there a contract between Inhae and Olivia? Is Inhae free to sell the exercise bicycle to Edgar? Provide legal authority for your reasoned answer.