The M-C-M’ diagram explains how capitalists maintain and increase their wealth by describing the flow of capital in a continuous cycle. Here’s a breakdown of the process:

• M (Money): The capitalist starts with money (M), which they use to invest in commodities, including raw materials, machinery, and labor.
• C (Commodity): The money is used to purchase commodities, which are then transformed through production. This stage involves the use of labor to create a new product that has greater value than the sum of its inputs.
• M’ (Money Prime): The newly created commodities are then sold for more money than the initial investment (M’). The increase in money, represented as M’ (M plus surplus value), comes from the added value created during production, primarily through the exploitation of labor.

In essence, the M-C-M’ cycle shows that the capitalist does not simply buy to consume but rather buys to sell at a profit. By continuously reinvesting and repeating this cycle, capitalists can accumulate more wealth. The key to this process is the surplus value. The difference between what workers are paid and the value of what they produce, which is then accumulated for the capitalists. This cycle allows capitalists to maintain their position in the wealth hierarchy and continuously expand their capital​.

M(money) The moment for capitalists to shine and buy workers to do their jobs and get money from them. 

C(Commodities) Is determined by the amount of social labor inherent in it, and its price is on monetary expression of the value. Exchanges cannot change the value of commodities. The building. Machines and equipment, raw materials, and labor power are purchased by the capitalist for the sum M,ect

M(Money) Capitalists buy the labor power of many works to sell the products they made for a higher value. The more labor work you do the less money you get. More time and more value and money for the capitalist. 

As we learned thus far, the capitalist class consists of people who own wealth, as well as the means of production in American society. An important question in understanding how this class works is to ask: how does a capitalist remain wealthy? The answer to this question depends largely on understanding the diagram M-C-M’. So, let’s practice by explaining what happens in this diagram in our own words (but basing our ideas on Reading 5.1). Respond to the following question:  Explain M-C-M’ to show how capitalists maintain and increase their wealth. (hint: your answer should weave a summary that includes what you reviewed in the self-assessment exercise question 1-7)

M.C.M stands for money commodities and more Money: money is the bases of everything in a capitalist economy money is best seen as capital for capital or better way to say it, an investment. Spending money to make money usually seen in the likes of merchants or street vendors. They buy a product and sell it at a higher price and make a profit. This is why merchants travel far and wide. Merchants buy a product in a place where that product is plentiful (therefore the price is lower) and then sell it at a place where that item is less common (at a higher price).

Money for commodities on the other hand is money used to buy materials and equipment to make products as well as labor (employees) to make that product.

Then that product gets sold and make even more profit because of mass production.

A capitalist remains wealthy by engaging in small-scale commodity production and using the general formula for capital. This system allows capitalists to accumulate wealth over time. Small-Scale Commodity Production uses the C-M-C model. “C” stands for commodity, which means the goods that people make and “M” stands for money. A person makes a product (“C”) and sells that product for money (“M”) and then uses that money to buy something they need (“C”). In contrast, the M-C-M model uses a buying in order to sell approach. “M” represents the initial amount of money and “C” is the commodity bought. The second “M” indicates the represents surplus value or profit. The primary difference between the two models lies in their outcomes. C-M-C is centered on meeting needs and personal consumption. M-C-M is focused on generating profit through the process of buying low and selling high. The transformation from money (M) into capital (M-C-M’) involves investing into things that generate surplus value. Capitalists invest their earned money into labor and resources into things that lead to profit when they sell the commodities for more than what they spent.

The M-C-M’ diagram is key to understanding how capitalists sustain and grow their wealth within a capitalist system. Here’s a breakdown of what each element represents and how they interact.

M (Money): This is the starting point for capitalists. They begin with a certain amount of money that they use to invest in the production process.
C (Commodities): The money is used to purchase commodities, which can include labor, raw materials, and machinery. These commodities are essential for creating goods or services.
M’ (Increased Money): After the commodities are produced and sold, the capitalists receive money back, but ideally, this amount is greater than the initial investment. The difference between the original amount of money (M) and the amount received after sales (M’) represents profit.
The process can be summarized as follows: a capitalist invests money (M) to buy resources and labor (C), produces goods, and sells them for a higher price, thus generating more money (M’).

This cycle allows capitalists to continually reinvest their profits into further production, expanding their wealth over time. Key factors that enable this process include market demand, efficiency in production, and the ability to control costs, especially labor costs. By consistently repeating this cycle—transforming money into commodities and back into more money—capitalists can maintain and increase their wealth, reinforcing their economic power within society.

1. As we learned thus far, the capitalist class consists of people who own wealth, as well as the means of production in American society. An important question in understanding how this class works is to ask: how does a capitalist remain wealthy? The answer to this question depends largely on understanding the diagram M-C-M’. So, let’s practice by explaining what happens in this diagram in our own words (but basing our ideas on Reading 5.1). Respond to the following question: Explain M-C-M’ to show how capitalists maintain and increase their wealth. (hint: your answer should weave a summary that includes what you reviewed in the self-assessment exercise question 1-7)