The subject is business law but it is not on the list so in order to post this question i had to select a subject so i selected finance.

Subject : Business Law

PUFF Corp manufactures several different models of Widgets. There most popular model is a line of Purple Widgets. But they also manufacture Red Widgets, Blue Widgets and Orange Widgets.

Dragon Inc. is a design company and as part of a design project they need 1,000 widgets that are purple in color. They contact PUFF and tell them the purpose of why they need the purple widgets. The salesperson says "No problem, we can send you out 1000 Purple Widgets tomorrow at $100.00 a piece - we just need you to first sign an invoice; Puff emails Dragon Inc. an invoice that lists 1000 Purple Widgets.

Dragon Inc. signs the invoice and pays the price. A week later 1000 Purple Widgets arrive by delivery; however, while they are clearly labeled Purple Widgets they are gray in color.

Dragon Inc. phones Puff and complains. The salesperson advises that all of their Widgets are grey, the color only refers to the model of widget not to its color.

Is there a valid contract? If so, has it been breached?

In answering the question, also discuss the difference between the literal approach to contractual interpretation versus the contextual approach.

Who might prefer which approach in the above scenario and why?

Please provide references for Citation.

Thank you!