[anewaccountname]

When you hear "Microsoft makes a surprise, unsolicited offer to buy Yahoo!", that means there hasn't been any negotiation yet, and that this is the minimum offer (they can accept it right now; the only downside is the risk that they don't pass the reg approval process). Now, you gave two possible outcomes, but as others have mentioned there is a third: a counter offer for more money.

(yet another outcome is that Yahoo twiddles it's thumbs and Microsoft rescinds the offer, but in that case you can look forward to getting in on a nice shareholder class-action lawsuit against the board)