Which of the following best describe the objective approach used by the courts in deciding whether a contract has been formed?

1. Applying legal principles and rules to determine the existence of offer, acceptance, consideration, and intention to create legal relations.
2. Focusing on the objective manifestations of the parties' intentions rather than their subjective beliefs or intentions.
3. Considering the words and actions of the parties from an outsider's perspective to determine if a reasonable person would believe a contract was formed.
4. Emphasizing the importance of clear and unambiguous communication between the parties to establish a valid contract.

Focuses on the parties' external expressions of intent