How we produce and exchange the necessities of life. Not for personal use (natural vs. exchange economy) Two characteristic of a commodity: use value: meets a need, exchange value: price/$ By . : the labour time required to produce a commodity car vs pencil example, under normal conditions of production in a given society, with the average degree of skill, the intensity of labour. Workers legally free to sell labour power in marketplace. Use value: helps the capitalist to make $ Cost of means of survival of the worker. Cost of means of survival of worker"s family. = cost of labour power and commodities for family. Price and wage can be affected by: supply and demand, market conditions. November 7, 2017: advertising/branding, social conditions: e. g. mode of production. Forces of production: labour force (who and division of labour) Relations of production (property relations): who owns and controls the means of production.