- Explain M-C-M’ to show how capitalists maintain and increase their wealth.
The formula M-C-M stands for Money, Commodity – More Money
The M is the beginning where the capitalist already starts out with money, they have then the C is commodity. The capitalist uses the money to purchase commodities, labor, materials whatever they need for the service that they’re going to sell, I believe the commodity is the stage where the capitalist puts money into things to make the product and then the M for more money that comes after production the commodities are sold for a price that’s way higher than what the capitalist paid for it originally.
When this happens, since the capitalist already had money to invest, they keep doing it, and it’s a cycle of accumulation since they already have the money, they can maintain a continuous operation of labor, materials, and commodities. The profit they make comes from the surplus value created by labor, which means workers produce more value than they are paid for.
