It causes the reader to think that Cecily is a quick-witted person. Cecily was able to respond quickly with a counter argument, but that doesn’t mean that Cecily dislikes Algernon, that Algernon is funny or that Algernon is confused. (Algernon definitely isn’t confused since he was making a statement of how Cecily was his little cousin...meaning younger.)
The man finally realizes his own vulnerability.
