Correct!

With respect to the first level of the flow chart, note that Smith used relevant words in identifying what wanted, saying "I mean hoops like this." Note also that his actions identified what he wanted, when he held up the green hula-hoop that is two-feet in diameter.

With respect to the second level of the flow chart, note that Smith describes the marketing of the hula-hoops, explains the symbolism with environmental causes, and clarifies why hula-hoops that are two feet in diameter are superior to those that are three feet in diameter. This provides further detail to the circumstances, as the parties understood them.

When Jones responds by saying, "OK, I promise to sell you the hula-hoops," he does so in a context in which a reasonable person would conclude that the words (of Smith and Jones) and actions (of Smith) were a promise to Smith to buy and Jones to sell the specified two-foot-in-diameter, dark green hula-hoops.

Given the context, no other interpretation is reasonable.

You have completed this tutorial.