>>That's not what you proposed earlier. Just asking for a timeline is different than trying to determine whether a situation is hopeless. If you say you are considering another offer, you are putting yourself further out of the running though. Everyone knows this to be true, but no one says it unless they feel that they are the frontrunner and can take that risk.
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>Looks like the decision could not be made soon from the e-mail exchanges.

They should never had sent an email asking about it. Yes, they should take the current job offered.