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Following the characters of the previous act, the story continues with Higgins and Pickering having a conversation at the former’s residence. They talk about Higgins’s work and are interrupted by Mrs. Pearce who brings a guest with her. 

It is Eliza, the flower girl. She claims to learn and improve her language skills from Higgins and offers to pay for her tuition. Pickering finds the opportunity fascinating and offers to pay for Eliza’s stay if Higgins accepts the challenge to transform her personality in six months.

He challenges Higgins to work his charms to turn Eliza into a proper lady by the time of the grand ball. Eliza feels unsure about the situation and wants to leave.

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However, Higgins is excited about the challenge and offers her money if she stays the distance. Mrs. Pearce is skeptical of the arrangement but eventually offers to help. The two women depart to give Eliza a makeover.

Pickering is also bemused by Higgins’s excitement and enquires if he is attracted by the young girl. Higgins dismisses the suggestion. They are soon greeted by Eliza’s father Mr. Alfred Doolittle. He had been informed by Eliza’s friend about her plans after Eliza had asked him to bring her bags from the house.

However, Alfred is not there to take her back and has brought her bags instead. He shamelessly suggests that Higgins should keep her for his pleasure and pay him some money in return.

Higgins is fascinated by his conduct and gives him money. Their conversation is interrupted when Eliza returns after her bath. She is transformed and Higgins manages to cause Alfred to leave and avoid any uncomfortable moment.

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Mrs. Pearce gestures Eliza to return to her room and try her new attire. When she leaves, both Higgins and Pickering look at each other, worrying about the next six months.

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