1. The general formula of the capitalists is M-C-M’. M stands for money, the money you are using to buy your commodity not to use but for more money than what you bought the commodity for. C stands for commodities, and M’ stands to be wealthy, it’s like when you purchase a limited edition pair of shoes and you resell it for double the amount you purchased it for they get more profit from that product they get a surplus value. This formula helps capitalists maintain and increase their wealth if their money is transformed into capital; which means the capital money functions are based on the labor power that the capitalist buys off the workers and the same capital buys the means of production to enable labor power to function. The capitalist transforms money capital into productive capital which includes buildings, tools, equipment, raw materials, other supplies, and labor power. An example of how this formula helps capitalists maintain and increase their wealth is by a capitalist is to engage in the ongoing exploitation of taking advantage of a particular worker to maintain her wealth status. You don’t become wealthy by saving up, no you become wealthy by owning building properties, and having low-class working people (non-wealthy) help build your status because you become rich off of the work of others.

The mcm is a formula that is used to maintain and increase the wealth that capitalist use . M is how much Money you have in the beginning and c is the commodity that is produced or used and m is a change no of commodity .

Veronica Gonzalez

POL 100 (0504) – Intro. to American Govt. – Fall 2022

Discussion Board 5.2Q.1 From my perspective the way that capitalist maintain and increase their wealth based on the M-C-M is that the continued investment of profit generated from their initial investment is constantly being re-invested, not only in the products their workers are producing, but the profits created by these initial products are also being invested into new and different areas and markets of business and that generate new profit. The capitalist is in constant and continued competition to create and produce the next new thing (product, idea, design) to offer the public. Investing in new ventures, new products and new types of business opens up money making markets that introduces them to workers that offer a new type of labor power in markets that can generate even more profits. Surplus value is key in capitalism in that it allows for the worker to labor and produce more yet capitalists don’t need to increase the workers wages. Capitalists set wages that their workers are paid yet in reality, workers are not paid what they are truly worth or for how much labor they put into what they produce mainly because the owner will be the one to benefit not from a wage but from the profits that are generated. According to P. Jalee, “the production and maintenance of labor power requires means of subsistence the value of which represents the value of labor power (pg.25)”. In essence capitalists know that surplus value and profits are all dependent on the qualified and unqualified labor power that they have and that keeping this labor power prospering means their workers need to have their basic needs met in order to keep producing profit for the owner.

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) 

The capitalist uses his money to purchase a commodity, and then sells that commodity to make a profit on his investment. Examples of such commodities include labor, hotels, stocks, debt etc. It does not matter what the commodity is, only that it will give a return on his investment. This way the capitalist remains rich. Suppose a capitalist invests 500 million dollars in a savings account. Using interest rates    of about 1.3 percent on his savings account, he will generate around 5million dollars a year from this seemingly senseless investment. Thus, the person who has this much money does not have to do anything to make more money. The money does all the leg work for them. 

The rich can reinvest their money into capital, whereas the poor have too much trouble making ends meet to save their wages, and ironically, these costs of living tend to profit the rich. Additionally, the rich control the cost of living and well as the wages. 

A capitalists remains wealthy by counting to make profits and investing in stocks and bonds. With M C M meaning for Money Commodity Money, capitalists use their very own money to buy resources such as machines, fuel to be able to provide their employees to labor. Capitalists continue to invest into business and profits that they know they would benefit from and many capitalists already are wealthy from being born into the family wealth.

M-C-M stands for M(money)-C(commodity)-M(money)

It’s simple, as stated in the text, it’s another way of saying they will not spend on something they can’t resell and make more out of. So, if they don’t profit out of it they won’t bother using money for it. Perfect example, real estate. In real estate, you can fix up a home and resell or overall rent out a house to make wages off of the people living there. Sounds easy but then again the rich keep making money off of people whom are just trying to have a roof over their head. They know what they are investing in and make sure they will be profiting off of the working class.

The formula that capitalists use to maintain, and increase their wealth is M-C-M’.

The capitalist uses their capital M to invest or buy a commodity that will bring them more money, the commodity can be hotels, land, or even labor. Then after buying the commodity, the capitalist resells the commodity, C, which brings in more money, M’, more money than the capital invested in the commodity in the beginning.

The capitalist maintains and increases their wealth by transforming their extra money, M, into commodities, C, and then changing that commodity into more money, M’. The capitalist sells his money to get more money; at the end of the day, they have more money than they had before.

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)

M-C-M is money , commodity and then money again. The first M is not the same as the second M. The first M is the money being put into it by whether the companies or the owners while on the other hand the last M is the profit they are receiving. Which will be the surplus value. However, if it doesn’t go right for them, the capitalist will always put their money back into the process and start over with the operations as fast as possible. The capitals starting with money to acquire more money is what helps them increase their capital. The operation is limited due to the goods. But with the capitalist higher power they are able to devote their capital to factories , machinery, raw materials and ect. Labor power and value brings up the surplus value. The more value that is put into making or constructing a project or product. Bring this value to a higher price. If the value is most valuable and the work ethic is shown in the product, the more money the customers would want to pay. With them consuming more money the better the surplus value is on the capitalist side.

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)

M-C-M’ is a cycle , M – being how much money you have in the beginning , whereas C is the commodity that you produce or used while being produced , and M again is a change of commodity back to money . So with this said M-C-M’ for the capitalist is making the money , putting it to use , and earning it back .