1) The first M is the money a capitalist commits at the beginning. They have to buy buildings, machines, equipment and materials in order to produce. But they also need to buy labor power, by getting workers to do labor for them. They pay the workers a wage in exchange for their labor power. Next, the workers produce the commodities, represented by the C. These commodities are then sold. However, the worker only gets paid their wage, no matter how much money is earned. This surplus value is then used to repeat the cycle, which is how capitalists maintain and increase their wealth.