Anne's friend Diana surprises her with the news that her story "Averil's Atonement" has won a prize from a baking powder manufacturer, since Diana had submitted it on her own initiative and added a product placement. Anne is initially dismayed by the commercial use of her work, but is comforted by Gilbert, who encourages her to use the prize money for her studies. Back in Kingsport, Anne moves into the shared house "Patty's Place" with her friends and the housekeeper Aunt Jamesina. Anne adopts a stray cat named Rusty. During a walk, Gilbert finally confesses his love to Anne and asks her to become his wife. Anne rejects his marriage proposal and emphasizes that her feelings for him are purely platonic. Hurt, Gilbert withdraws. Dejected, Anne returns to Avonlea prematurely, where she is welcomed by her family and reflects on the events, while her friend Miss Lavendar expresses her regret about Anne's decision.