The novel follows the intertwined lives of its characters, particularly the aristocratic Rulledge family and the titular "Ragged Lady," an impoverished woman named Margaret Kent. As the story unfolds, the Rulledge family, led by the wealthy and esteemed Judge Rulledge, experiences a series of financial setbacks that lead to their downfall. Meanwhile, Margaret Kent, who once belonged to a higher social class, struggles to make ends meet and support her daughter.
The paths of these characters converge when Judge Rulledge becomes aware of Margaret's plight and offers her a position as a companion to his daughter, Cynthia. Through their interactions, the stark differences in their social backgrounds become apparent, highlighting the disparities between the privileged and the marginalized in society.
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