Review the item:
____________ on the kitchen counter, the chocolate chip cookie teased Spencer the Chihuahua, who sat on the linoleum, whining and drooling.

The chocolate chip cookie is resting on the counter. Thus, you need a form of lie. The sentence requires a present participle.

Consult the table below or review the rules.

Infinitive Definition Simple
Present
Simple
Past
Past
Participle
Present
Participle
to lay to put something down lay(s) laid laid laying
to lie to rest or recline lie(s) lay lain lying

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