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This act is set in a large drawing room of Lyobov's house. A ball is in progress; ironically, the auction of the estate is being held at the same time. It is as if Lyobov is trying to defy fate. Still, she cannot really enjoy the dance, for she constantly wonders what is happening at the auction. Even though the wealthy aunt has lent Gaev fifteen thousand dollars, Lyobov fears it will not be enough for him to buy the orchard and keep it in the family.
Pishtchik's conversation about the importance of money in life takes on a new significance in this act. It is Lyobov's lack of money that causes her to lose her childhood home; and even Varya worries about how she will have enough money to pay the Jewish orchestra that she has hired for the dance. It is also the money of the emerging middle class that gives them new power. Lopahin is able to buy the cherry orchard for he has gathered wealth as a merchant. His interest in money also seems to stand in the way of his pursuit of Varya.
During the dance, Firs, the old valet, becomes the mouthpiece for the dying aristocracy. He laments that stationmasters and postal clerks have replaced barons and generals at the parties held at the cherry orchard. He realizes that times are changing in Russia, and a new social order is emerging. The full extent of the change is clearly seen when Lopahin, a former slave, is able to buy the aristocratic estate of Lyobov. The irony is pointed and obvious.
Lyobov is shocked and crushed at the news of the sale of the cherry orchard to Lopahin. Although Varya tries to comfort her mother, she is inconsolable. In truth, she weeps for the loss of her home and a whole way of life in Russia.